Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Aug. 25, 2016 | Dec. 31, 2015 | |
Document And Entity Information | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | SCANSOURCE INC | ||
Entity Central Index Key | 918,965 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 25,625,806 | ||
Entity Current Reporting Status | Yes | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 845,986,524 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Assets | ||
Cash and cash equivalents | $ 61,400 | $ 121,646 |
Accounts receivable, less allowance of $39,032 at June 30, 2016 and $32,589 at June 30, 2015 | 559,557 | 522,532 |
Inventories | 558,581 | 553,063 |
Prepaid expenses and other current assets | 49,367 | 46,917 |
Total current assets | 1,228,905 | 1,244,158 |
Property and equipment, net | 52,388 | 46,574 |
Goodwill | 92,715 | 66,509 |
Net identifiable intangible assets | 51,127 | 46,272 |
Deferred income taxes | 28,813 | 38,963 |
Other non-current assets | 37,237 | 34,465 |
Total assets | 1,491,185 | 1,476,941 |
Liabilities and Shareholders’ Equity | ||
Current debt | 0 | 2,860 |
Accounts payable | 471,487 | 501,329 |
Accrued expenses and other current liabilities | 98,975 | 81,000 |
Current portion of contingent consideration | 11,594 | 9,391 |
Income taxes payable | 3,056 | 4,180 |
Total current liabilities | 585,112 | 598,760 |
Deferred income taxes | 2,555 | 3,773 |
Long-term debt, net of current portion | 5,429 | 5,966 |
Borrowings under revolving credit facility | 71,427 | 0 |
Long-term portion of contingent consideration | 13,058 | 24,569 |
Other long-term liabilities | 39,108 | 34,888 |
Total liabilities | 716,689 | 667,956 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Preferred stock, no par value; 3,000,000 shares authorized, none issued | 0 | 0 |
Common stock, no par value; 45,000,000 shares authorized, 25,614,673 and 28,214,153 shares issued and outstanding at June 30, 2016 and June 30, 2015, respectively | 67,249 | 157,172 |
Retained earnings | 779,934 | 716,315 |
Accumulated other comprehensive (loss) income | (72,687) | (64,502) |
Total shareholders’ equity | 774,496 | 808,985 |
Total liabilities and shareholders’ equity | $ 1,491,185 | $ 1,476,941 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Current assets: | ||
Allowance for accounts receivable | $ 39,032 | $ 32,589 |
Shareholders’ equity: | ||
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 3,000,000 | 3,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 45,000,000 | 45,000,000 |
Common stock, shares issued (in shares) | 25,614,673 | 28,214,153 |
Common stock, shares outstanding (in shares) | 25,614,673 | 28,214,153 |
Consolidated Income Statements
Consolidated Income Statements - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Statement [Abstract] | |||
Net sales | $ 3,540,226 | $ 3,218,626 | $ 2,913,634 |
Cost of goods sold | 3,184,786 | 2,891,536 | 2,612,535 |
Gross profit | 355,440 | 327,090 | 301,099 |
Selling, general and administrative expenses | 257,269 | 222,982 | 192,492 |
Legal recovery on impairment charges | 0 | 0 | (15,490) |
Change in fair value of contingent consideration | 1,294 | 2,667 | 2,311 |
Operating income | 96,877 | 101,441 | 121,786 |
Interest expense | 2,124 | 1,797 | 731 |
Interest income | (3,448) | (2,638) | (2,364) |
Other (income) expense, net | 2,191 | 2,376 | 312 |
Income before income taxes | 96,010 | 99,906 | 123,107 |
Provision for income taxes | 32,391 | 34,487 | 41,318 |
Net income | $ 63,619 | $ 65,419 | $ 81,789 |
Per share data: | |||
Net income per common share, basic (in dollars per share) | $ 2.40 | $ 2.29 | $ 2.89 |
Weighted-average shares outstanding, basic (in shares) | 26,472 | 28,558 | 28,337 |
Net income per common share, diluted (in dollars per share) | $ 2.38 | $ 2.27 | $ 2.86 |
Weighted-average shares outstanding, diluted (in shares) | 26,687 | 28,799 | 28,602 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income Statement - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 63,619 | $ 65,419 | $ 81,789 |
Foreign currency translation adjustment | (8,185) | (47,802) | 6,272 |
Comprehensive income | $ 55,434 | $ 17,617 | $ 88,061 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Beginning Balance, Shares at Jun. 30, 2013 | 27,971,809 | |||
Beginning Balance, Amount at Jun. 30, 2013 | $ 695,956 | $ 149,821 | $ 569,107 | $ (22,972) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 81,789 | 81,789 | ||
Foreign currency translation adjustment | 6,272 | 6,272 | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes, shares | 567,672 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | 12,581 | $ 12,581 | ||
Share based compensation | 5,328 | 5,328 | ||
Tax benefit (shortfall) of deductible compensation arising from exercise or vesting of share based payment arrangements | 717 | $ 717 | ||
Ending Balance, Shares at Jun. 30, 2014 | 28,539,481 | |||
Ending Balance, Amount at Jun. 30, 2014 | 802,643 | $ 168,447 | 650,896 | (16,700) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 65,419 | 65,419 | ||
Foreign currency translation adjustment | (47,802) | (47,802) | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes, shares | 154,497 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | 760 | $ 760 | ||
Common stock repurchased, shares | (479,825) | |||
Common stock repurchased | (18,768) | $ (18,768) | ||
Share based compensation | 6,517 | 6,517 | ||
Tax benefit (shortfall) of deductible compensation arising from exercise or vesting of share based payment arrangements | $ 216 | $ 216 | ||
Ending Balance, Shares at Jun. 30, 2015 | 28,214,153 | 28,214,153 | ||
Ending Balance, Amount at Jun. 30, 2015 | $ 808,985 | $ 157,172 | 716,315 | (64,502) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 63,619 | 63,619 | ||
Foreign currency translation adjustment | (8,185) | (8,185) | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes, shares | 284,730 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | 3,994 | $ 3,994 | ||
Common stock repurchased, shares | (2,884,210) | |||
Common stock repurchased | (100,751) | $ (100,751) | ||
Share based compensation | 7,093 | 7,093 | ||
Tax benefit (shortfall) of deductible compensation arising from exercise or vesting of share based payment arrangements | $ (259) | $ (259) | ||
Ending Balance, Shares at Jun. 30, 2016 | 25,614,673 | 25,614,673 | ||
Ending Balance, Amount at Jun. 30, 2016 | $ 774,496 | $ 67,249 | $ 779,934 | $ (72,687) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities: | |||
Net income | $ 63,619 | $ 65,419 | $ 81,789 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 17,154 | 11,997 | 7,375 |
Amortization of debt issue costs | 297 | 297 | 312 |
Provision for doubtful accounts | 7,571 | 993 | 6,573 |
Share-based compensation | 7,093 | 6,522 | 5,248 |
Deferred income taxes | 1,846 | 3,921 | 8,606 |
Excess tax benefits from share-based payment arrangements | (101) | (260) | (982) |
Change in fair value of contingent consideration | 1,294 | 2,667 | 2,311 |
Changes in operating assets and liabilities, net of acquisitions: | |||
Accounts receivable | 14,167 | (14,476) | (31,860) |
Inventories | 2,999 | (37,695) | (99,214) |
Prepaid expenses and other assets | 4,612 | 2,337 | 6,206 |
Other noncurrent assets | (2,186) | 1,431 | 1,285 |
Accounts payable | (71,706) | 28,280 | 57,532 |
Accrued expenses and other liabilities | 6,401 | 7,449 | (5,357) |
Income taxes payable | (849) | (3,360) | 7,898 |
Net cash provided by (used in) operating activities | 52,211 | 75,522 | 47,722 |
Cash flows from investing activities: | |||
Capital expenditures | (12,081) | (20,762) | (11,228) |
Cash paid for business acquisitions, net of cash acquired | (61,475) | (59,779) | 0 |
Net cash provided by (used in) investing activities | (73,556) | (80,541) | (11,228) |
Cash flows from financing activities: | |||
Borrowings (repayments) short-term borrowings, net | 0 | (24,097) | 0 |
Borrowings on revolving credit, net of expenses | 1,376,620 | 93,579 | 0 |
Repayments on revolving credit, net of expenses | (1,305,193) | (93,579) | 0 |
Repayments on long-term debt | (2,792) | (9,146) | 0 |
Repayments of capital lease obligations | (223) | (262) | 0 |
Debt issuance costs | 0 | 0 | (468) |
Contingent consideration payments | (8,606) | (5,640) | (3,810) |
Exercise of stock options | 3,994 | 760 | 12,581 |
Repurchase of common stock | (100,206) | (18,768) | 0 |
Excess tax benefits from share-based payment arrangements | 101 | 260 | 982 |
Net cash provided by (used in) financing activities | (36,305) | (56,893) | 9,285 |
Effect of exchange rate changes on cash and cash equivalents | (2,596) | (11,293) | 908 |
Increase (decrease) in cash and cash equivalents | (60,246) | (73,205) | 46,687 |
Cash and cash equivalents at beginning of period | 121,646 | 194,851 | 148,164 |
Cash and cash equivalents at end of period | 61,400 | 121,646 | 194,851 |
Supplemental disclosure of cash flow information: | |||
Interest paid during the year | 1,706 | 1,075 | 739 |
Income taxes paid during the year | $ 33,859 | $ 36,272 | $ 24,323 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Business and Summary of Significant Accounting Policies | Business and Summary of Significant Accounting Policies Business Description ScanSource , Inc. is a leading global provider of technology products and solutions. ScanSource, Inc. and its subsidiaries ("the Company") provide value-added solutions for technology manufacturers and sell to resellers in specialty technology markets through its Worldwide Barcode & Security segment and Worldwide Communications & Services segment. The Company's two operating segments are based on product, customer and service type. The Company operates in the United States, Canada, Latin America and Europe. The Company sells to the United States and Canada from its distribution centers located in Mississippi and Virginia; to Latin America principally from distribution centers located in Florida, Mexico, Brazil and Colombia; and to Europe from distribution centers located in Belgium, France, Germany and the United Kingdom. Consolidation Policy The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated. Related Party Transactions A related party is generally defined as (i) any person that holds 10% or more of the Company’s securities and their immediate families, (ii) the Company’s management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. There were no material related party transactions for the fiscal years ended June 30, 2016 , 2015 , and 2014 . Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to the allowance for uncollectible accounts receivable, contingent consideration, and inventory reserves. Management bases its estimates on assumptions that management believes to be reasonable under the circumstances, the results of which form a basis for making judgments about the carrying value of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates under different assumptions or conditions; however, management believes that its estimates, including those for the above described items, are reasonable and that the actual results will not vary significantly from the estimated amounts. The following significant accounting policies relate to the more significant judgments and estimates used in the preparation of the Consolidated Financial Statements: (a) Allowances for Trade and Notes Receivable The Company maintains an allowance for uncollectible accounts receivable for estimated losses resulting from customers’ failure to make payments on accounts receivable due to the Company. Management determines the estimate of the allowance for uncollectible accounts receivable by considering a number of factors, including: (1) historical experience, (2) aging of the accounts receivable, (3) specific information obtained by the Company on the financial condition and the current creditworthiness of its customers, and (4) the current economic and country specific environment. If the financial condition of the Company’s customers were to deteriorate and reduce the ability of the Company’s customers to make payments on their accounts, the Company may be required to increase its allowance by recording additional bad debt expense. Likewise, should the financial condition of the Company’s customers improve and result in payments or settlements of previously reserved amounts, the Company may be required to record a reduction in bad debt expense to reverse the recorded allowance. (b) Inventory Reserves Management determines the inventory reserves required to reduce inventories to the lower of cost or market based principally on the effects of technological changes, quantities of goods and length of time on hand, and other factors. An estimate is made of the market value, less cost to dispose, of products whose value is determined to be impaired. If these products are ultimately sold at less than estimated amounts, additional reserves may be required. The estimates used to calculate these reserves are applied consistently. The adjustments are recorded in the period in which the loss of utility of the inventory occurs, which establishes a new cost basis for the inventory. This new cost basis is maintained until such time that the reserved inventory is disposed of, returned to the vendor or sold. To the extent that specifically reserved inventory is sold, cost of goods sold is expensed for the new cost basis of the inventory sold. (c) Purchase Price Allocations For each acquisition, the Company allocates the purchase price to assets acquired, liabilities assumed, and goodwill and intangibles in accordance with ASC 805. We recognize assets and liabilities acquired at the their estimated fair values. Management uses judgment to (1) identify the acquired assets and liabilities assumed, (2) estimate the fair value of these assets, (3) estimate the useful life of the assets, and (4) assess the appropriate method for recognizing depreciation or amortization expense over the asset’s useful life. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less, when purchased, to be cash equivalents. The Company maintains some zero-balance disbursement accounts at various financial institutions in which the Company does not maintain significant depository relationships. Due to the nature of the Company’s banking relationships with these institutions, the Company does not have the right to offset most if not all outstanding checks written from these accounts against cash on hand, and the respective institutions are not legally obligated to honor the checks until sufficient funds are transferred to fund the checks. Checks released but not yet cleared from these accounts in the amounts of $78.3 million and $62.9 million are classified as accounts payable as of June 30, 2016 and June 30, 2015 , respectively. The Company maintains its cash with various financial institutions globally that are monitored regularly for credit quality and holds amounts in excess of Federal Deposit Insurance Corporation ("FDIC") limits or other insured limits. Cash and cash equivalents held outside of the United States totaled $52.7 million and $43.4 million as of June 30, 2016 and 2015 , respectively. Concentration of Credit Risk The Company sells to a large base of value-added resellers throughout the United States, Canada, Latin America and Europe. The Company performs ongoing credit evaluations of its customers’ financial condition. In certain cases, the Company will accept tangible assets as collateral to increase the trade credit of its customers. In addition, the Company carries credit insurance on certain subsections of the customer portfolio. No single customer accounted for more than 5% of the Company’s net sales for fiscal years 2016 , 2015 , or 2014 . The Company has established arrangements with certain customers for longer-term financing. The Company accounts for these arrangements by recording them at their historical cost less specific allowances at balance sheet dates. Interest income is recognized in the period earned and is recorded as interest income in the Consolidated Income Statement. Derivative Financial Instruments The Company uses derivative instruments to manage certain exposures related to fluctuations in foreign currency exchange rates and changes in interest rates in connection with borrowing activities. We record all derivative instruments as either assets or liabilities in the Consolidated Balance Sheet at fair value. The Company does not use derivative financial instruments for trading or speculative purposes. The Company’s foreign currency exposure results from purchasing and selling internationally in several foreign currencies and from intercompany loans with foreign subsidiaries. In addition, the Company may have foreign currency risk related to debt that is denominated in currencies other than the U.S. dollar. The Company's foreign currencies are denominated primarily in Brazilian reais, euros, British pounds, Canadian dollars, Mexican pesos, Colombian pesos, Chilean pesos, and Peruvian nuevos. The Company may reduce its exposure to fluctuations in foreign exchange rates by creating offsetting positions through the use of derivative financial instruments. The market risk related to the foreign exchange agreements is offset by changes in the valuation of the underlying items. These contracts are generally for a duration of 90 days or less. The Company has elected not to designate its foreign currency contracts as hedging instruments. They are, therefore, marked-to-market with changes in their fair value recorded in the Consolidated Income Statement each period. Derivative financial instruments related to foreign currency exposure are accounted for on an accrual basis with gains or losses on these contracts recorded in income in the period in which their value changes, with the offsetting entry for unsettled positions reflected in either other assets or other liabilities. During the fiscal year ended June 30, 2015, through the acquisition of Network1, the Company assumed borrowings denominated in foreign currencies that were hedged into the functional currency of the respective borrowing entity using cross-currency swaps in order to mitigate the impact of foreign currency exposures and interest rate exposures on these borrowings. These swaps involved the exchange of principal and fixed interest receipts of U.S. dollar-denominated debt held by one of our Brazilian subsidiaries (Network1) for principal and variable interest payments in Brazilian reais. The impact of the changes in foreign exchange rates of the cross-currency debt instruments were recognized as adjustments to other income and expense in the Consolidated Income Statements. Interest rate differentials paid or received under the swap agreements were recognized as adjustments to interest expense in the Consolidated Income Statements. Investments The Company has investments that are held in a grantor trust formed by the Company related to the ScanSource, Inc. Nonqualified Deferred Compensation Plan and Founder’s Supplemental Executive Retirement Plan ("SERP"). The Company has classified these investments as trading securities, and they are recorded at fair market value with unrealized gains and losses included in the accompanying Consolidated Income Statements. The Company’s obligations under this deferred compensation plan change in concert with the performance of the investments along with contributions to and withdrawals from the plan. The fair value of these investments and the corresponding deferred compensation obligation was $17.9 million and $16.0 million as of June 30, 2016 and June 30, 2015 , respectively. These investments are classified as either prepaid expenses and current assets or other non-current assets in the Consolidated Balance Sheets depending on the timing of planned disbursements. The deferred compensation obligation is classified either within accrued expenses and other current liabilities or other long-term liabilities as well. The amounts of these investments classified as current assets with corresponding current liabilities were $1.6 million and $0.7 million at June 30, 2016 and June 30, 2015 , respectively. Inventories Inventories (consisting entirely of finished goods) are stated at the lower of cost (first-in, first-out method) or market. Vendor Programs The Company receives incentives from vendors related to cooperative advertising allowances, volume rebates and other incentive agreements. These incentives are generally under quarterly, semi-annual or annual agreements with the vendors. Some of these incentives are negotiated on an ad hoc basis to support specific programs mutually developed between the Company and the vendor. Vendors generally require that we use their cooperative advertising allowances exclusively for advertising or other marketing programs. Incentives received from vendors for specifically identified incremental cooperative advertising programs are recorded as adjustments to selling, general and administrative expenses. FASB's Accounting Standards Codification ("ASC") 605 – Revenue Recognition , addresses accounting by a customer (including a reseller) for certain consideration received from a vendor. This guidance requires that the portion of these vendor funds in excess of our costs be reflected as a reduction of inventory. Such funds are recognized as a reduction of the cost of goods sold when the related inventory is sold. The Company records unrestricted volume rebates received as a reduction of inventory a reduction of the cost of goods sold when the related inventory is sold. Amounts received or receivables from vendors that are not yet earned are deferred in the Consolidated Balance Sheets. In addition, the Company may receive early payment discounts from certain vendors. The Company records early payment discounts received as a reduction of inventory, thereby resulting in a reduction of cost of goods sold when the related inventory is sold. ASC 605 requires management to make certain estimates of the amounts of vendor incentives that will be received. Actual recognition of the vendor consideration may vary from management estimates. Vendor Concentration The Company sells products from many vendors, however, sales of products supplied by Avaya, Cisco, and Zebra each constituted more than 10% of the Company’s net sales for the year ended June 30, 2016 . For the year ended June 30, 2015 , sales of products supplied by Avaya and Zebra each constituted more than 10% of the Company's net sales. Sales of products supplied by Avaya, Honeywell, and Zebra constituted more than 10% of the Company's net sales for the year ended June 30, 2014 . Product Warranty The Company’s vendors generally provide a warranty on the products provided by the Company and allow the Company to return defective products, including those that have been returned to the Company by its customers. In three of our product lines, the Company offers a self-branded warranty program, in which management has determined that the Company is the primary obligor. The Company purchases contracts from unrelated third parties, generally the original equipment manufacturers, to fulfill any obligation to service or replace defective product claimed on these warranty programs. As a result, the Company has not recorded a provision for estimated service warranty costs. For all other product lines, the Company does not independently provide a warranty on the products it sells; however, to maintain customer relations, the Company facilitates returns of defective products from the Company’s customers by accepting for exchange, with the Company’s prior approval, most defective products within 30 days of invoicing. Property and Equipment Property and equipment are recorded at cost. Depreciation is computed using the straight-line method over estimated useful lives of 3 to 10 years for furniture, equipment and computer software, 40 years for buildings and 15 years for building improvements. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life. Maintenance, repairs and minor renewals are charged to expense as incurred. Additions, major renewals and betterments to property and equipment are capitalized. To the extent that the Company has longstanding, "in-process" projects that have not been implemented for their intended operational use, the Company capitalizes the portion of interest expense incurred during the asset's acquisition period that theoretically could have been avoided in accordance with ASC 835. The amount capitalized is determined by applying the appropriate capitalization rate to the average amount of accumulated expenditures for the asset during the reporting period. The capitalization rate used is based on the rates applicable to borrowings outstanding during the reporting period. Capitalized Software The Company accounts for capitalized software in accordance with ASC 350-40, which provides guidance for computer software developed or obtained for internal use. The Company is required to continually evaluate the stage of the implementation process to determine whether or not costs are expensed or capitalized. Costs incurred during the preliminary project phase or planning and research phase are expensed as incurred. Costs incurred during the development phase, such as material and direct services costs, compensation costs of employees associated with the development, and interest cost, are capitalized as incurred. Costs incurred during the post-implementation or operation phase, such as training and maintenance costs, are expensed as incurred. In addition, costs incurred to modify existing software that result in additional functionality are capitalized as incurred. Goodwill The Company accounts for recorded goodwill in accordance with ASC 350, Goodwill and Other Intangible Assets , which requires that goodwill be reviewed annually for impairment or more frequently if impairment indicators exist. Goodwill testing utilizes a two-step impairment analysis, whereby the Company compares the carrying value of each identified reporting unit to its fair value. The carrying value of goodwill is reviewed at a reporting unit level at least annually for impairment, or more frequently if impairment indicators exist. Our goodwill reporting units align directly with our operating segments, Barcode & Security and Communications & Services. The fair values of the reporting units are estimated using the net present value of discounted cash flows generated by each reporting unit. Considerable judgment is necessary in estimating future cash flows, discount rates and other factors affecting the estimated fair value of the reporting units, including the operating and macroeconomic factors. Historical financial information, internal plans and projections, and industry information are used in making such estimates. In the two-step impairment analysis, goodwill is first tested for impairment by comparing the fair value of the reporting unit with the reporting unit's carrying amount to identify any potential impairment. If fair value is determined to be less than carrying value, a second step is used whereby the implied fair value of the reporting unit's goodwill, determined through a hypothetical purchase price allocation, is compared with the carrying amount of the reporting units' goodwill. If the implied fair value of the reporting unit's goodwill is less than its carrying amount, an impairment charge is recorded in current earnings for the difference. We also assess the recoverability of goodwill if facts and circumstances indicate goodwill may be impaired. In our most recent annual test, we estimated the fair value of our reporting units primarily based on the income approach utilizing the discounted cash flow method. We also utilized fair value estimates derived from the market approach utilizing the public company market multiple method to validate the results of the discounted cash flow method, which required us to make assumptions about the applicability of those multiples to our reporting units. The discounted cash flow method required us to estimate future cash flows and discount those amounts to present value. The key assumptions utilized in determining fair value included: • Industry weighted-average cost of capital ("WACC"): We utilized a WACC relative to each reporting unit's respective geography and industry as the discount rate for estimated future cash flows. The WACC is intended to represent a rate of return that would be expected by a market place participant in each respective geography. • Operating income: We utilized historical and expected revenue growth rates, gross margins and operating expense percentages, which varied based on the projections of each reporting unit being evaluated. • Cash flows from working capital changes: We utilized a projected cash flow impact pertaining to expected changes in working capital as each of our goodwill reporting units grow. See Note 6 - Goodwill and Other Identifiable Intangible Assets for more information regarding goodwill and the results of our testing. Intangible Assets Intangible assets consist of customer relationships, trade names, distributor agreements and non-compete agreements. Customer relationships and distributor agreements are amortized using the straight-line method over their estimated useful lives, which range from 5 to 15 years. Trade names are amortized over a period ranging from 1 to 5 years. Non-compete agreements are amortized over their contract life. Debt issuance costs are amortized over the term of the credit facility. These assets are shown in detail in Note 6 - Goodwill and Other Identifiable Intangible Assets. Impairment of Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset or asset group may not be recoverable. Tests for recoverability of a long-lived asset to be held and used are measured by comparing the carrying amount of the long-lived asset to the sum of the estimated future undiscounted cash flows expected to be generated by the asset. In estimating the future undiscounted cash flows we use projections of cash flows directly associated with, and which are expected to arise as a direct result of, the use and eventual disposition of the assets. If it is determined that a long-lived asset is not recoverable, an impairment loss would be calculated equal to the excess of the carrying amount of the long-lived asset over its fair value. Fair Value of Financial Instruments The fair value of financial instruments is the amount at which the instrument could be exchanged in a current transaction between willing parties. The carrying values of financial instruments such as accounts receivable, accounts payable, accrued liabilities, borrowings under the revolving credit facility and subsidiary lines of credit approximate fair value based upon either short maturities or variable interest rates of these instruments. For additional information related to the fair value of derivatives, please see Note 9 - Fair Value of Financial Instruments . Liability for Contingent Consideration In addition to the initial cash consideration paid to former shareholders of CDC, Imago, and Network1, the Company is obligated to make additional earnout payments based on future results through a specified date based on a multiple of the subsidiary’s pro forma earnings measure as defined in the respective share purchase agreements. Future payments are to be paid in the subsidiary's local currency. In accordance with ASC 805, the Company determined the fair value of this liability for contingent consideration on the respective acquisition dates using a form of a probability-weighted discounted cash flow model following the income approach. Each period, the Company reflects the contingent consideration liability at fair value with changes recorded in the change in fair value of contingent consideration line item in the Consolidated Income Statements. The final earnout payment to the former shareholders of CDC was paid during fiscal year 2016. Contingencies The Company accrues for contingent obligations, including estimated legal costs, when it is probable that a liability is incurred and the amount is reasonably estimable. As facts concerning contingencies become known, management reassesses its position and makes appropriate adjustments to the financial statements. Estimates that are particularly sensitive to future changes include tax, legal, and other regulatory matters, which are subject to change as events evolve, and as additional information becomes available during the administrative and litigation process. Revenue Recognition Revenue is recognized once four criteria are met: (1) the Company must have persuasive evidence that an arrangement exists; (2) delivery must occur (this includes the transfer of both title and risk of loss, provided that no significant obligations remain); (3) the price must be fixed and determinable; and (4) collectability must be reasonably assured. The Company allows its customers to return product for exchange or credit subject to certain limitations. The Company provides third-party service contracts, typically for product maintenance and support. These service contracts are sold separately from the products, and the Company often serves as the agent for the contract on behalf of the original equipment manufacturer. Since the Company acts as an agent on behalf of most of these service contracts sold, revenue is recognized net of cost at the time of sale. However, the Company provides some self-branded warranty programs and engages a third party (generally the original equipment manufacturer) to cover the fulfillment of any obligations arising from these contracts. These revenues and associated third-party costs are amortized over the life of the contract and presented in net sales and cost of goods sold, respectively. Service revenue associated with third-party service contracts and warranty programs, as mentioned above, along with configuration and marketing services is recognized when the work is complete, and the four criteria discussed above have been substantially met. Service revenue associated with service contracts, warranty programs, configuration, marketing and other services approximates 3% of consolidated net sales for fiscal years 2016 and 2015 , compared to 2% of consolidated net sales for fiscal year 2014 . During the fiscal years ended June 30, 2016 , 2015 and 2014 , the Company did not engage in sales transactions involving multiple element arrangements. Shipping Revenue and Costs Shipping revenue is included in net sales, and related costs are included in cost of goods sold. Shipping revenue was $13.0 million for the year ended June 30, 2016 and $12.2 million for the years ended June 30, 2015 and 2014 , respectively. Advertising Costs The Company defers advertising-related costs until the advertising is first run in trade or other publications, or in the case of brochures, until the brochures are printed and available for distribution. Advertising costs, included in marketing costs, after vendor reimbursement, were not significant in any of the three fiscal years ended June 30, 2016 . Deferred advertising costs for any of the three fiscal years ended June 30, 2016 were also not significant. Foreign Currency The currency effects of translating the financial statements of the Company’s foreign entities that operate in their local currency are included in the cumulative currency translation adjustment component of accumulated other comprehensive income or loss. The Company's functional currencies include U.S. dollars, Brazilian reais, euros, British pounds, and Canadian dollars. The assets and liabilities of these foreign entities are translated into U.S. dollars using the exchange rate at the end of the respective period. Sales, costs and expenses are translated at average exchange rates effective during the respective period. Foreign currency transactional and re-measurement gains and losses are included in other expense (income) in the Consolidated Income Statements. Such amounts are not significant to any of the periods presented. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes reflect tax consequences on future years of differences between the tax bases of assets and liabilities and their financial reporting amounts. Valuation allowances are provided against deferred tax assets when it is more likely than not that an asset will not be realized in accordance with ASC 740, Accounting for Income Taxes. In 2016, the Company adopted Accounting Standards Update ("ASU") 2015-17, Balance Sheet Classification of Deferred Taxes and reclassified all current deferred taxes and the related valuation allowances to noncurrent positions on the Consolidated Balance Sheets. The Company has provided for U.S. income taxes for the current earnings of its Canadian subsidiary. Earnings from all other geographies are considered retained indefinitely for reinvestment. See Note 12 - Income Taxes for further discussion. Additionally, the Company maintains reserves for uncertain tax provisions in accordance with ASC 740. See Note 12 - Income Taxes for more information. Share-Based Payments The Company accounts for share-based compensation using the provisions of ASC 718, Accounting for Stock Compensation , which requires the recognition of the fair value of share-based compensation. Share-based compensation is estimated at the grant date based on the fair value of the awards, in accordance with the provisions of ASC 718. Since this compensation cost is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company has elected to expense grants of awards with graded vesting on a straight-line basis over the requisite service period for each separately vesting portion of the award. Comprehensive Income ASC 220, Comprehensive Income , defines comprehensive income as the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. The components of comprehensive income for the Company include net income and foreign currency translation adjustments arising from the consolidation of the Company’s foreign subsidiaries. Currently, the Company is not engaged in any cash flow hedges that qualify for hedge accounting. Business Combinations The Company accounts for business combinations in accordance with ASC 805, Business Combinations . ASC 805 establishes principles and requirements for recognizing the total consideration transferred to and the assets acquired, liabilities assumed and any non-controlling interest in the acquired target in a business combination. ASC 805 also provides guidance for recognizing and measuring goodwill acquired in a business combination and requires the acquirer to disclose information that users may need to evaluate and understand the financial impact of the business combination. See Note 5 - Acquisitions for further discussion. Reclassifications In accordance with ASU 2015-17, all prior year deferred income taxes that were previously classified as current assets and liabilities have been reclassified to non-current positions on the Consolidated Balance Sheets. The Company reclassified $20.6 million of deferred income tax previously classified as current assets to non-current assets as of June 30, 2015. Recent Accounting Pronouncements In May 2014, the FASB issued a comprehensive new revenue recognition standard for contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The core principle of this standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, the standard provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. This guidance also requires enhanced disclosures regarding the nature, |
Earnings per Share
Earnings per Share | 12 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share Basic earnings per share are computed by dividing net income by the weighted-average number of common shares outstanding. Diluted earnings per share are computed by dividing net income by the weighted-average number of common and potential common shares outstanding. Fiscal Year Ended June 30, 2016 2015 2014 (in thousands, except per share data) Numerator: Net income $ 63,619 65,419 81,789 Denominator: Weighted-average shares, basic 26,472 28,558 28,337 Dilutive effect of share-based payments 215 241 265 Weighted-average shares, diluted 26,687 28,799 28,602 Net income per common share, basic $ 2.40 $ 2.29 $ 2.89 Net income per common share, diluted $ 2.38 $ 2.27 $ 2.86 For the years ended June 30, 2016 , 2015 and 2014 , weighted-average shares outstanding excluded from the computation of diluted earnings per share because their effect would have been antidilutive were 461,090 , 340,697 and 230,706 , respectively. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment is comprised of the following: June 30, 2016 2015 (in thousands) Land $ 3,009 $ 3,009 Buildings and leasehold improvements 20,473 21,266 Computer software and equipment 46,112 44,444 Furniture, fixtures and equipment 23,316 16,849 Construction in progress 4,897 126 97,807 85,694 Less accumulated depreciation (45,419 ) (39,120 ) $ 52,388 $ 46,574 During the fiscal year ended June 30, 2016 , the increase in net fixed assets from the prior year is largely due to capital expenditures for building expansions and improvements to the Company's headquarters in Greenville, SC and SAP improvements during the year. Depreciation expense was $7.3 million , $5.4 million , and $3.5 million , respectively, for the fiscal years ended 2016 , 2015 , and 2014 . |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Jun. 30, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities is comprised of the following: June 30, 2016 2015 (in thousands) Deferred warranty revenue $ 29,836 $ 22,346 Accrued compensation 19,917 20,906 Accrued marketing expense 2,459 1,480 Accrued freight 3,507 3,291 Brazilian pre-acquisition contingencies 2,941 3,676 Other taxes payable 11,044 9,240 Other accrued liabilities 29,271 20,061 $ 98,975 $ 81,000 |
Acquisitions
Acquisitions | 12 Months Ended |
Jun. 30, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions KBZ On September 4, 2015, the Company acquired substantially all the assets of KBZ Communications, Inc., a Cisco Authorized Distributor specializing in video conferencing, services, and cloud. KBZ is part of the Company's Worldwide Barcode and Security operating segment. This acquisition enables the Company to enhance its focus on Cisco’s solutions, combining the strengths of both distributors to provide a more robust portfolio of products, solutions and services. The results of operations of KBZ have been included in the consolidated results from the date of acquisition. Under the asset purchase agreement, the Company acquired the assets of KBZ for a cash payment of $64.6 million . The Company acquired $3.1 million of cash during the acquisition, resulting in $61.5 million net cash paid for KBZ. The purchase price of this acquisition was allocated to the assets acquired and liabilities assumed based on their estimated fair values on the transaction date. Pro forma results of operations have not been presented for this acquisition because the results of this acquisition are not material to our consolidated results. The purchase price allocation is as follows: September 4, 2015 (in thousands) Receivables, net $ 63,131 Inventory 11,227 Other Current Assets 10,303 Property and equipment, net 677 Goodwill 21,639 Identifiable intangible assets 18,400 Other non-current assets 1,399 $ 126,776 Accounts payable $ 48,271 Accrued expenses and other current liabilities 14,863 Other long-term liabilities 2,167 Consideration transferred, net of cash acquired 61,475 $ 126,776 Intangible assets acquired include trade names, customer relationships, and non-compete agreements. The weighted-average amortization period for these identified intangible assets after purchase accounting adjustments, other than goodwill, was 8 years. Network1 On January 13, 2015, the Company acquired 100% of the shares of Network1. Network1 is a Brazilian value-added provider of communications equipment and services and is part of the Company’s Worldwide Communications and Services operating segment. ScanSource is committed to becoming the leading value-added provider of communications solutions for resellers in Latin America, and this acquisition represents an important step in this strategy. Under the share purchase agreement, the Company structured the purchase transaction with an initial cash payment of approximately $29.1 million , plus additional annual cash installments based on a form of adjusted earnings before interest expense, taxes, depreciation and amortization ("adjusted EBITDA") over the next 4 years, commencing with the period ending June 30, 2015. The Company acquired $4.8 million of cash during the acquisition, resulting in $24.3 million net cash paid for Network1. The Company assumed net debt of $35.2 million as part of the initial purchase consideration. Pro forma results of operations and a complete purchase price allocation have not been presented for this acquisition because the results of this acquisition are not material to our consolidated results. The purchase price of this acquisition was allocated to the assets acquired and liabilities assumed based on their estimated fair values on the transaction date. Please see Note 9 - Fair Value of Financial Instruments for further information regarding the fair value accounting for this contingent consideration and Note 13 - Commitments and Contingencies for further information regarding pre-acquisition contingencies and related indemnification receivables. During the second quarter of fiscal year 2016, the Company finalized the purchase accounting for the Network1 acquisition and recorded all purchase accounting adjustments. Further, during the third quarter of the fiscal year 2016, the Company identified an adjustment related to deferred taxes in association with the Network1 acquisition. The adjustment resulted in a reclassification of approximately $7.9 million from other non-current assets to goodwill as of the opening balance sheet date. There was no impact to previously reported retained earnings, income from continuing operations, net income or earnings per share. Goodwill Identifiable Intangible Assets (in thousands) Purchase price allocation June 30, 2015 $ 22,536 $ 23,258 Opening balance sheet adjustments 8,496 (76 ) Purchase price allocation June 30, 2016 $ 31,032 $ 23,182 Intangible assets acquired include trade names, customer relationships, and non-compete agreements. The weighted-average amortization period for these identified intangible assets after purchase accounting adjustments, other than goodwill, was 9 years. Imago On September 19, 2014, the Company acquired 100% of the shares of Imago Group plc, a European value-added provider of video and voice communications equipment and services. Subsequent to the acquisition, the Company changed Imago's name to ScanSource Video Communications Ltd. (dba Imago ScanSource). Imago ScanSource is part of the Company’s Worldwide Communications and Services operating segment. This acquisition supports the Company’s strategy to be the leading value-added provider of video, voice, and networking solutions for resellers in Europe. Under the share purchase agreement entered into with Imago, the Company structured the purchase transaction with an initial cash payment of $37.4 million , plus 2 additional annual cash installments for the twelve month periods ending September 30, 2015 and 2016, based on a form of adjusted EBITDA. The Company acquired $1.9 million of cash during the acquisition, resulting in net $35.5 million cash paid for Imago ScanSource. Please see Note 9 - Fair Value of Financial Instruments for further information regarding the fair value accounting for this contingent consideration. Pro forma results of operations and a complete purchase price allocation have not been presented for this acquisition because the results of this acquisition are not material to our consolidated results. The purchase price of this acquisition was allocated to the assets acquired and liabilities assumed based on their estimated fair values on the transaction date, resulting in goodwill and identifiable intangible assets. The purchase price allocated to goodwill and identifiable intangible assets as of the acquisition date is as follows: Goodwill Identifiable Intangible Assets (in thousands) Imago ScanSource $ 18,266 $ 19,606 Intangible assets acquired include trade names, customer relationships, and non-compete agreements. The weighted-average amortization period for these identified intangible assets after purchase accounting adjustments, other than goodwill, was 9 years. For tax purposes, due to the nondeductible nature of the amortization of identifiable intangible assets acquired, the Company recorded a deferred tax liability in the amount of $4.1 million . The deferred tax liability represents the difference between the book and tax bases in the assets and will decrease over time as the assets are amortized for book purposes. |
Goodwill and Other Identifiable
Goodwill and Other Identifiable Intangible Assets | 12 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Identifiable Intangible Assets | Goodwill and Other Identifiable Intangible Assets In accordance with ASC 350, Intangibles - Goodwill and Other Intangible Assets , the Company performs its annual goodwill impairment test during the fourth quarter of each fiscal year, or whenever indicators of impairment are present. The reporting units utilized for goodwill impairment tests align directly with our operating segments, Barcode & Security and Communications & Services.The testing includes the determination of each reporting unit's fair value using a discounted cash flows model compared to each reporting unit's carrying value. Key assumptions used in determining fair value include projected growth and operating margin, working capital requirements and discount rates. During fiscal years ended June 30, 2016 , 2015 , and 2014 , no impairment charges related to goodwill were recorded. Changes in the carrying amount of goodwill for the years ended June 30, 2016 and 2015 , by reportable segment, are as follows: Barcode & Security Segment Communications & Services Segment Total (in thousands) Balance at June 30, 2014 $ 16,876 $ 15,466 $ 32,342 Additions — 40,802 40,802 Unrealized gain (loss) on foreign currency translation (1,341 ) (5,294 ) (6,635 ) Balance at June 30, 2015 $ 15,535 $ 50,974 $ 66,509 Additions 21,639 8,496 1 30,135 Unrealized gain (loss) on foreign currency translation (740 ) (3,189 ) (3,929 ) Balance at June 30, 2016 $ 36,434 $ 56,281 $ 92,715 1 The Company finalized the purchase accounting for the Network1 acquisition during the quarter ended December 31, 2015 and subsequently identified an additional correction in the quarter ended March 31, 2016, which resulted in an increased value assumed for goodwill as compared to June 30, 2015. The following table shows the Company’s identifiable intangible assets as of June 30, 2016 and 2015 , respectively. June 30, 2016 June 30, 2015 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value (in thousands) Amortized intangible assets: Customer relationships $ 70,379 $ 26,668 $ 43,711 $ 59,448 $ 20,573 $ 38,875 Trade names 11,270 4,398 6,872 7,857 1,278 6,579 Non-compete agreements 1,103 777 326 1,113 539 574 Distributor agreements 345 127 218 345 101 244 Total intangibles $ 83,097 $ 31,970 $ 51,127 $ 68,763 $ 22,491 $ 46,272 During fiscal years 2016 and 2015, the Company acquired new customer relationships, trade names and non-compete agreements related to the acquisitions of KBZ, Imago ScanSource and Network1. The weighted-average amortization period for all intangible assets was approximately 10 years for years ended June 30, 2016 and 2015 and 11 years for the year ended June 30, 2014 , respectively. Amortization expense for the years ended June 30, 2016 , 2015 and 2014 was $9.8 million , $6.6 million and $3.9 million , respectively. Estimated future amortization expense is as follows: Amortization Expense (in thousands) Year Ended June 30, 2017 $ 10,266 2018 8,084 2019 6,004 2020 5,387 2021 5,277 Thereafter 16,109 Total $ 51,127 |
Short-Term Borrowings and Long-
Short-Term Borrowings and Long-Term Debt | 12 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings and Long-Term Debt | Short-Term Borrowings and Long-Term Debt Short-Term Borrowings Imago ScanSource has multi-currency invoice discounting credit facilities secured by the subsidiary’s assets for its operations based in the United Kingdom. The invoice discounting facilities allow for the issuance of funds up to 85% of the amount of each invoice processed, subject to limits by currency of £ 4.2 million , € 0.3 million , and $0.1 million . Borrowings under the invoice discounting facilities bear interest at a base rate determined by currency, plus a spread of 1.85% . The base rate is the United Kingdom base rate published by the Bank of England for British pound sterling-based borrowings, 30-day Euro Interbank Offered Rate ("EUROLIBOR") for Euro-based borrowings, and the Lloyds Bank daily USD published rate for the U.S. dollar-based borrowings. Additionally, the Company is assessed an annual commitment fee of less than £ 0.1 million . There were no outstanding balances at June 30, 2016 . Revolving Credit Facility The Company has a $300 million multi-currency senior secured revolving credit facility with JPMorgan Chase Bank N.A., as administrative agent, and a syndicate of banks (the “Amended Credit Agreement”) that matures on November 6, 2018 . The Amended Credit Agreement allows for the issuance of up to $50 million for letters of credit and has a $150 million accordion feature that allows the Company to increase the availability to $450 million , subject to obtaining additional credit commitments for the lenders participating in the increase. At the Company's option, loans denominated in U.S. dollars under the Amended Credit Agreement, other than swingline loans, bear interest at a rate equal to a spread over the London Interbank Offered Rate ("LIBOR") or alternate base rate depending upon the Company's ratio of total debt (excluding accounts payable and accrued liabilities), measured as of the end of the most recent quarter, to adjusted earnings before interest expense, taxes, depreciation and amortization ("EBITDA") for the most recently completed four quarters (the "Leverage Ratio"). The Leverage Ratio calculation excludes the Company's subsidiary in Brazil. This spread ranges from 1.00% to 2.25% for LIBOR-based loans and 0.00% to 1.25% for alternate base rate loans. The spread in effect for the period ended June 30, 2016 was 1.00% for LIBOR-based loans and 0.00% for alternate base rate loans. Additionally, the Company is assessed commitment fees ranging from 0.175% to 0.40% , depending upon the Leverage Ratio, on non-utilized borrowing availability, excluding swingline loans. The commitment fee rate in effect for the period ended June 30, 2016 was 0.175% . Borrowings under the Amended Credit Agreement are guaranteed by substantially all of the domestic assets of the Company and a pledge of up to 65% of capital stock or other equity interest in certain foreign subsidiaries determined to be either material or a subsidiary borrower as defined in the Amended Credit Agreement. The Company was in compliance with all covenants under the credit facility as of June 30, 2016 . There was $71.4 million and $0.0 million outstanding on the revolving credit facility at June 30, 2016 and June 30, 2015 . The average daily balance on the revolving credit facility during the year ended June 30, 2016 and 2015 was $86.6 million and $1.6 million , respectively. There was $228.2 million and $300 million available for additional borrowings as of June 30, 2016 and 2015 , respectively. Letters of credit issued under the multi-currency revolving credit facility totaled €0.4 million and €0.0 million as of June 30, 2016 and 2015 respectively. Long-Term Debt On August 1, 2007, the Company entered into an agreement with the State of Mississippi in order to provide financing for the acquisition and installation of certain equipment to be utilized at the Company’s Southaven, Mississippi distribution facility, through the issuance of an industrial development revenue bond. The bond matures on September 1, 2032 and accrues interest at a rate equal to 30-day LIBOR plus a spread of 0.85% . The terms of the bond allow for payment of interest only for the first 10 years of the agreement, and then, starting on September 1, 2018 through 2032, principal and interest payments are due until the maturity date or the redemption of the bond. The agreement also provides the bondholder with a put option, exercisable only within 180 days of each 5 th anniversary of the agreement, requiring the Company to pay back the bonds at 100% of the principal amount outstanding. As of June 30, 2016 , the Company was in compliance with all covenants under this bond. The balance on the bond was $5.4 million as of June 30, 2016 and 2015 and is included in long-term debt. The interest rate at June 30, 2016 and 2015 was 1.32% and 1.03% , respectively. Network1 held a term loan agreement, denominated in U.S. dollars, with Banco Safra to provide funding for working capital needs. The loan was secured by accounts receivable of the subsidiary. The term loan matured on September 21, 2015 and was repaid in full. The terms of the loan provided for quarterly payments and bore interest at 3.6% per annum. The loan possessed a cross-currency swap contract which bore interest at a base rate equal to the Average One-Day Interbank Deposit Rate ("CDI" rate), plus a spread 2.75% per annum. The CDI interest rate at June 30, 2015 was approximately 13.6% . The outstanding balance as of June 30, 2016 and 2015 was $0.0 million and $0.7 million , respectively. Network1 had secured multiple term loan agreements, denominated in Brazilian reals, with Banco Bradesco, to provide funding for working capital needs. The term loans matured on May 9, 2016 and were repaid in full. The terms of the loans provided for bi-annual payments of varying amounts and bore interest at 11.48% per annum. The outstanding balance as of June 30, 2016 and 2015 was $0.0 million and $1.8 million , respectively. Network1 had a secured term loan agreement, denominated in Brazilian real, with Banco do Brasil to provide funding for working capital needs. The term loan was scheduled to mature on October 28, 2017 . The terms of the loan provided for monthly payments and bore interest at 12.08% per annum. During the current fiscal year, the Company repaid the loan in full in advance of its maturity date. The outstanding balance as of June 30, 2016 and 2015 was $0.0 million and $0.9 million , of which $0.4 million was classified as current, respectively. Scheduled maturities of the Company’s revolving credit facility and long-term debt at June 30, 2016 are as follows: Long-Term Debt Revolving Credit Facility (in thousands) Fiscal year: 2017 $ — $ — 2018 — — 2019 329 71,427 2020 333 — 2021 338 — Thereafter 4,429 — Total principal payments $ 5,429 $ 71,427 Debt Issuance Costs As of June 30, 2016 , net debt issuance costs associated with the credit facility and bonds totaled $0.7 million and are being amortized on a straight-line basis through the maturity date of each respective debt instrument. |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 12 Months Ended |
Jun. 30, 2016 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Derivatives and Hedging Activities | Derivatives and Hedging Activities The Company’s results of operations could be materially impacted by significant changes in foreign currency exchange rates and interest rates. These risks and the management of these risks are discussed in greater detail below. In an effort to manage the exposure to these risks, the Company periodically enters into various derivative instruments. The Company’s accounting policies for these instruments are based on whether the instruments are designated as hedge or non-hedge instruments in accordance with U.S. GAAP. The Company records all derivatives on the balance sheet at fair value. Derivatives that are not designated as hedging instruments or the ineffective portions of cash flow hedges are adjusted to fair value through earnings in other income and expense. Foreign Currency Derivatives – The Company conducts a portion of its business internationally in a variety of foreign currencies. The exposure to market risk for changes in foreign currency exchange rates arises from foreign currency denominated assets and liabilities, and transactions arising from non-functional currency financing or trading activities. The Company’s objective is to preserve the economic value of non-functional currency denominated cash flows. The Company attempts to hedge transaction exposures with natural offsets to the fullest extent possible and, once these opportunities have been exhausted, through currency options and forward contracts or other hedging instruments with third parties. These contracts will periodically hedge the exchange of various currencies, including the U.S. dollar, Brazilian real, euro, British pound, Canadian dollar, Mexican peso and Chilean peso. While the Company utilizes foreign exchange contracts to hedge foreign currency exposure, the Company's foreign exchange policy prohibits the use of derivative financial instruments for speculative purposes. The Company had contracts outstanding with notional amounts of $46.2 million and $80.6 million for the exchange of foreign currencies as of June 30, 2016 and 2015 , respectively. To date, the Company has chosen not to designate these derivatives as hedging instruments, and accordingly, these instruments are adjusted to fair value through earnings in other income and expense. Summarized financial information related to these derivative contracts and changes in the underlying value of the foreign currency exposures are as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Net foreign exchange derivative contract (gain) loss $ (1,951 ) $ (5,364 ) $ 3,640 Net foreign currency transactional and re-measurement (gain) loss 4,522 8,408 (3,024 ) Net foreign currency (gain) loss $ 2,571 $ 3,044 $ 616 Net foreign exchange gains and losses consist of foreign currency transactional and functional currency re-measurements, offset by net foreign currency exchange contract gains and losses and are included in other income and expense. Foreign exchange gains and losses are generated as the result of fluctuations in the value of the U.S. dollar versus the Brazilian real, the U.S. dollar versus the euro, British pound versus the euro, and other currencies versus the U.S. dollar. Cross-Currency Swaps – Through the acquisition of Network1, the Company had borrowings denominated in foreign currencies that were primarily hedged into the functional currency of the respective borrowing entity using cross-currency swaps in order to mitigate the impact of foreign currency exposures and interest rate exposures on these borrowings. These swaps involved the exchange of principal and fixed interest receipts of U.S. dollar-denominated debt held by one of our Brazilian subsidiaries (Network1) for principal and variable interest payments in Brazilian reais. The impact of the changes in foreign exchange rates of the cross-currency debt instruments were recognized as adjustments to other income and expense in the Consolidated Income Statements. Interest rate differentials paid or received under the swap agreements were recognized as adjustments to interest expense in the Consolidated Income Statements, which totaled approximately $0.5 million for the year ended June 30, 2015. The outstanding swaps were settled and the related borrowings were repaid in full during the fiscal year ended June 30, 2016. The Company has the following derivative instruments located on the Consolidated Balance Sheets and Income Statements, utilized for the risk management purposes detailed above: As of June 30, 2016 Fair Value of Derivatives Designated as Hedge Instruments Fair Value of Derivatives Not Designated as Hedge Instruments (in thousands) Derivative assets: (a) Foreign exchange contracts $ — $ 33 Derivative liabilities: (b) Foreign exchange contracts $ — $ 551 (a) All derivative assets are recorded as prepaid expense and other current assets in the Consolidated Balance Sheets. (b) All derivative liabilities are recorded as accrued expenses and other current liabilities in the Consolidated Balance Sheets. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Accounting guidance defines fair value as the price 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. Under this guidance, the Company is required to classify certain assets and liabilities based on the fair value hierarchy, which groups fair value-measured assets and liabilities based upon the following levels of inputs: • Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; • Level 2 – Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; • Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity). The assets and liabilities maintained by the Company that are required to be measured at fair value on a recurring basis include deferred compensation plan investments, outstanding foreign exchange forward contracts and contingent consideration owed to the previous owners of CDC, Imago ScanSource, and Network1. The carrying value of debt listed in Note 7 - Short-Term Borrowings and Long Term Debt is considered to approximate fair value, as the Company's debt instruments are indexed to a variable rate using the market approach (Level 2 criteria). The following table summarizes the valuation of the Company's remaining assets and liabilities measured at fair value on a recurring basis as of June 30, 2016 : Total Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 17,893 $ 17,893 $ — $ — Forward foreign currency exchange contracts 33 — 33 — Total assets at fair value $ 17,926 $ 17,893 $ 33 $ — Liabilities: Deferred compensation plan investments, current and non-current portion $ 17,893 $ 17,893 $ — $ — Forward foreign currency exchange contracts 551 — 551 — Liability for contingent consideration, current and non-current 24,652 — — 24,652 Total liabilities at fair value $ 43,096 $ 17,893 $ 551 $ 24,652 The following table presents assets and liabilities measured at fair value on a recurring basis as of June 30, 2015 : Total Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 15,970 $ 15,970 $ — $ — Forward foreign currency exchange contracts 125 — 125 — Cross-currency swap agreements $ 103 $ — $ 103 $ — Total assets at fair value $ 16,198 $ 15,970 $ 228 $ — Liabilities: Deferred compensation plan investments, current and non-current portion $ 15,970 $ 15,970 $ — $ — Forward foreign currency exchange contracts 476 — 476 — Liability for contingent consideration, current and non-current 33,960 — — 33,960 Total liabilities at fair value $ 50,406 $ 15,970 $ 476 $ 33,960 The investments in the deferred compensation plan are held in a "rabbi trust" and include mutual funds and cash equivalents for payment of non-qualified benefits for certain retired, terminated or active employees. These investments are recorded to prepaid and other current assets or other non-current assets depending on their corresponding, anticipated distributions to recipients, which are reported in accrued expenses and other current liabilities or other long-term non-current liabilities, respectively. Derivative instruments, such as foreign currency forward contracts and cross-currency swap agreements are measured using the market approach on a recurring basis considering foreign currency spot rates and forward rates quoted by banks or foreign currency dealers and interest rates quoted by banks (Level 2). See Note 8 - Derivatives and Hedging Activities . Foreign currency contracts and cross-currency swap agreements are classified in the consolidated balance sheet as prepaid expenses and other current assets or accrued expenses and other current liabilities, depending on the respective instruments' favorable or unfavorable positions. The Company recorded contingent consideration liabilities at the acquisition date of CDC, Imago ScanSource and Network1 representing the amounts payable to former shareholders, as outlined under the terms of the applicable share purchase agreements, based upon the achievement of a projected earnings measure, net of specific pro forma adjustments. The current and non-current portions of these obligations are reported separately on the Consolidated Balance Sheets. The fair value of the contingent considerations (Level 3) are determined using a form of a probability weighted discounted cash flow model. Subsequent changes in the fair value of the contingent consideration liabilities are recorded to the change in fair value of contingent consideration line item in the Consolidated Income Statements. Fluctuations due to foreign currency translation are captured in other comprehensive income through the changes in foreign currency translation adjustments line item as seen in Note 15 - Accumulated Other Comprehensive (Loss) Income . CDC is part of the Company's Worldwide Barcode and Security Segment, and Imago ScanSource and Network1 are part of the Company's Worldwide Communications and Services segment. The tables below provides a summary of the changes in fair value of the Company’s contingent considerations for the CDC, Imago ScanSource, and Network1 earnouts, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended June 30, 2016 and 2015 : Contingent Consideration for the Year Ended June 30, 2016 Barcode & Security Segment Communications & Services Segment Total (in thousands) Fair value at beginning of period $ 5,109 $ 28,851 $ 33,960 Payments (4,453 ) (4,153 ) (8,606 ) Change in fair value 181 1,113 1,294 Fluctuation due to foreign currency exchange (837 ) (1,159 ) (1,996 ) Fair value at end of period $ — $ 24,652 $ 24,652 Contingent Consideration for the Year Ended June 30, 2015 Barcode & Security Segment Communications & Services Segment Total (in thousands) Fair value at beginning of period $ 11,107 $ — $ 11,107 Issuance of contingent consideration — 32,035 32,035 Payments (5,640 ) — (5,640 ) Change in fair value 1,636 1,031 2,667 Fluctuation due to foreign currency exchange (1,994 ) (4,215 ) (6,209 ) Fair value at end of period $ 5,109 $ 28,851 $ 33,960 The fair values of amounts owed are recorded in current portion of contingent consideration and long-term portion of contingent consideration in the Company's Consolidated Balance Sheets. The U.S. dollar amounts of actual disbursements made in conjunction with future earnout payments are subject to change as the liability is denominated in currencies other than the U.S. dollar and subject to foreign exchange fluctuation risk. Also, in accordance with ASC 805, the Company will revalue the contingent consideration liability at each reporting date through the last payment, with changes in the fair value of the contingent consideration reflected in the change in fair value of contingent consideration line item on the Company's Consolidated Income Statement that is included in the calculation of operating income. The fair value of the contingent consideration liability associated with future earnout payments is based on several factors, including: • estimated future results, net of pro forma adjustments set forth in the applicable share purchase agreements; • the probability of achieving these results; and • a discount rate reflective of the Company's creditworthiness and market risk premium associated with the Brazilian and European markets. A change in any of these unobservable inputs can significantly change the fair value of the contingent consideration. Barcode and Security The final payment of the contingent consideration related to CDC was paid during the current fiscal year. As of June 30, 2015 , the fair value of the contingent consideration was $5.1 million , all of which was classified as current. The change in fair value of the contingent consideration recognized in the Consolidated Income Statements was a loss of $0.2 million for the year ended June 30, 2016 . The loss was due to the recurring amortization of unrecognized fair value discount. Communications and Services Segment The fair value of the liability for the contingent consideration related to Imago ScanSource recognized at June 30, 2016 was $2.9 million , all of which is classified as current. As of June 30, 2015 , the fair value of the contingent consideration was $5.4 million , of which $2.6 million was classified as current. The change in fair value of the contingent consideration recognized in the Consolidated Income Statements was a loss of $0.9 million for the year ended June 30, 2016 , which was largely driven by the recurring amortization of the unrecognized fair value discount and achievement of better than expected actual results. In addition, volatility in the foreign exchange rate between the British pound and the U.S. dollar drove changes in the translation of this British pound denominated liability. Although there is no contractual limit, total future undiscounted contingent consideration payments are anticipated to range between $2.9 million and $3.0 million , based on the Company’s best estimate of the earnout. The fair value of the liability for the contingent consideration related to Network1 recognized at June 30, 2016 was $21.8 million of which $8.7 million is classified as current. As of June 30, 2015 , the fair value of the contingent consideration was $23.5 million , of which $1.7 million was classified as current. The change in fair value of the contingent consideration recognized in the Consolidated Income Statements was a loss of $0.2 million for the year ended June 30, 2016 , which was largely driven by the recurring amortization of the unrecognized fair value discount, partially offset by a reduction in future projected results. In addition, volatility in the foreign exchange rate between the Brazilian real and the U.S. dollar drove significant changes in the translation of this Brazilian real denominated liability. Although there is no contractual limit, total future undiscounted contingent consideration payments are anticipated to range up to $26.0 million , based on the Company’s best estimate of the earnout calculated on a multiple of adjusted earnings. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Jun. 30, 2016 | |
Share-based Compensation [Abstract] | |
Share-Based Compensation | Share-Based Compensation Share-Based Compensation Plans The Company has awards outstanding from three share-based compensation plans (the 1997 Stock Incentive Plan, the 2002 Long-Term Incentive Plan, and the 2013 Long-Term Incentive Plan). Awards are currently only granted under the 2013 Long-Term Incentive Plan. As of June 30, 2016 , there were 2,234,445 shares available for future grant under the 2013 Long-Term Incentive Plan. All of the Company’s share-based compensation plans are shareholder approved, and it is the Company’s belief that such awards better align the interests of its employees and directors with those of its shareholders. Under the plans, the Company is authorized to award officers, employees, consultants and non-employee members of the Board of Directors various share-based payment awards, including options to purchase common stock and restricted stock. Restricted stock can be in the form of a restricted stock award ("RSA"), restricted stock unit ("RSU") or a performance unit ("PU"). An RSA is common stock that is subject to risk of forfeiture or other restrictions that lapse upon satisfaction of specified conditions. An RSU represents the right to receive shares of common stock in the future with the right to future delivery of the shares subject to risk of forfeiture or other restrictions that lapse upon satisfaction of specified conditions. The Company accounts for its share-based compensation awards in accordance with ASC 718 – Stock Compensation, which requires all share-based compensation to be recognized in the income statement based on fair value and applies to all awards granted, modified, canceled, or repurchased after the effective date. Total share-based compensation included as a component of selling, general, and administrative expenses in our Consolidated Income Statements was as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Share-based compensation related to: Equity classified stock options $ 1,479 $ 1,480 $ 1,577 Equity classified restricted stock 5,614 5,042 3,671 Total share-based compensation $ 7,093 $ 6,522 $ 5,248 Stock Options During the fiscal year ended June 30, 2016 , the Company granted stock options for 128,000 shares to certain employees. These options vest annually over 3 years and have a 10 -year contractual life. These options were granted with an exercise price that is no less than 100% of the fair market value of the underlying shares on the date of the grant. The fair value of each option (for purposes of calculation of share-based compensation) was estimated on the date of grant using the Black-Scholes-Merton option pricing formula that uses assumptions determined at the date of grant. Use of this option pricing model requires the input of subjective assumptions. These assumptions include estimating the length of time employees will retain their vested stock options before exercising them ("expected term"), the estimated volatility of our common stock price over the expected term ("expected volatility") and the number of options that will ultimately not complete their vesting requirements ("forfeitures"). Changes in the subjective assumptions can materially affect the estimate of the fair value of share-based compensation and, consequently, the related amount recognized in the Consolidated Income Statements. The Company used the following weighted-average assumptions for the options granted during the following fiscal years: Fiscal Year Ended June 30, 2016 2015 2014 Expected term 4.02 years 4.02 years 4.00 years Expected volatility 28.70 % 30.06 % 33.70 % Risk-free interest rate 1.47 % 1.22 % 1.07 % Dividend yield 0.00 % 0.00 % 0.00 % Weighted-average fair value per option $ 9.53 $ 10.51 $ 11.91 The weighted-average expected term of the options represents the period of time the options are expected to be outstanding based on historical trends and behaviors of certain groups and individuals receiving these awards. The expected volatility is predominantly based on the historical volatility of our common stock for a period approximating the expected term. The risk-free interest rate reflects the interest rate at grant date on zero-coupon U.S. governmental bonds that have a remaining life similar to the expected option term. The dividend yield assumption was based on our dividend payment history and management's expectations of future dividend payments. A summary of our stock option plans is presented below: Fiscal Year Ended June 30, 2016 Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life Aggregate Intrinsic Value Outstanding, beginning of year 1,166,031 $ 35.09 Granted during the period 128,000 38.15 Exercised during the period (194,041 ) 29.04 Canceled, forfeited, or expired during the period (1,825 ) 32.03 Outstanding, end of year 1,098,165 36.52 5.35 $ 2,123,342 Vested and expected to vest at June 30, 2016 1,096,239 36.51 5.34 $ 2,123,244 Exercisable, end of year 819,670 $ 35.35 4.19 $ 2,120,598 The aggregate intrinsic value was calculated using the market price of our stock on June 30, 2016 and the exercise price for only those options that have an exercise price that is less than the market price of our stock. This amount will change as the market price per share changes. The aggregate intrinsic value of options exercised during the fiscal years ended June 30, 2016 , 2015 , and 2014 was $1.3 million , $0.6 million , and $5.4 million , respectively. A summary of the status of the Company’s shares subject to unvested options is presented below: Fiscal Year Ended June 30, 2016 Options Weighted Average Exercise Price Weighted Average Grant Date Fair- Value Unvested, beginning of year 286,580 $ 39.98 $ 10.91 Granted 128,000 38.15 9.53 Vested (136,085 ) 38.29 10.93 Canceled or forfeited — — — Unvested, end of year 278,495 $ 39.96 $ 10.27 As of June 30, 2016 , there was approximately $2.0 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the plans in the form of stock options. This cost is expected to be recognized over a weighted-average period of 1.10 years. The total fair value of options vested during the fiscal years ended June 30, 2016 , 2015 , and 2014 is $1.5 million , $1.6 million and $1.6 million , respectively. The following table summarizes information about stock options outstanding and exercisable as of June 30, 2016 : Options Outstanding Options Exercisable Range of Exercise Prices Shares Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $18.13 - $22.27 5,600 2.43 $ 18.14 5,600 $ 18.14 $22.27 - $26.38 30,000 3.43 24.57 30,000 24.57 $26.38 - $30.49 35,922 6.48 29.59 35,922 29.59 $30.49 - $34.60 296,929 3.38 33.23 296,929 33.23 $34.60 - $38.71 442,765 5.02 36.92 313,940 36.43 $38.71 - $42.82 286,949 8.02 41.77 137,279 42.04 1,098,165 5.35 $ 36.52 819,670 $ 35.35 The Company issues shares to satisfy the exercise of options. Restricted Stock Grants of Restricted Shares During the fiscal year ended June 30, 2016 , the Company granted 138,634 shares of restricted stock to employees and non-employee directors, all of which were issued in the form of RSUs or PUs: Fiscal Year Ended June 30, 2016 Shares granted Date granted Grant date fair value Vesting period Employees Certain employees 124,572 December 4, 2015 38.19 Annually over 3 years Certain employees 476 February 12, 2016 36.30 Annually over 3 years Non-Employee Directors (1) Certain Directors 13,500 December 4, 2015 $ 38.19 6 months (1) Under the 2013 Long-Term Incentive Plan, non-employee directors will receive annual awards of restricted stock, as opposed to stock options. The number of shares of restricted stock to be granted will be established from time to time by the Board of Directors. Currently, the number of shares of restricted stock awarded annually to each non-employee director generally will be determined by dividing $100,000 by the equity award value of the common stock on the date of grant, as defined in the 2013 Long-Term Incentive Plan. The equity award value means the value per share based on a 45 -day averaging of the fair market value of the common stock over a specified period of time, or the fair market value of the common stock on a specified date. These awards will generally vest in full on the day that is six months after the date of grant or upon the earlier occurrence of (i) the director’s termination of service as a director by reason of death, disability or retirement, or (ii) a change in control by the Company. The compensation expense associated with these awards will be recognized on a pro-rata basis over this period. A summary of the status of the Company’s outstanding restricted stock is presented below: Fiscal Year Ended June 30, 2016 Shares Weighted-Average Grant Date Fair Value Outstanding, beginning of year 279,196 $ 38.87 Granted during the period 138,634 38.18 Target shares adjustment during the period (1) 366 39.01 Vested during the period (133,068 ) 38.83 Cancelled, forfeited, or expired during the period (10,324 ) 40.65 Outstanding, end of year 274,804 $ 39.06 (1) These target shares granted as RSUs during fiscal year 2015 have service based and performance based vesting conditions. The actual number of shares granted for each of the three tranches, for the period June 1, 2014 through June 30, 2017, is determined after the date of the Company's financial statements. Therefore, the adjustment recognized during fiscal year 2016 represents the variance between the shares assumed to be granted versus at June 30, 2015 the actual shares granted for the first tranche. As of June 30, 2016 , there was approximately $7.6 million of unrecognized compensation cost related to unvested restricted stock awards and restricted stock units granted, which is expected to be recognized over a weighted-average period of 1.08 years. The Company withheld 42,379 shares for income taxes during the fiscal year ended June 30, 2016 . |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jun. 30, 2016 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company has a defined contribution plan under Section 401(k) of the Internal Revenue Code of 1986, as amended that covers all employees located in the United States meeting certain eligibility requirements. The Company provided a matching contribution equal to one-half of each participant’s contribution, up to a maximum matching contribution per participant of $800 . The Company determines its matching contributions annually and can make discretionary contributions in addition to matching contributions. Employer contributions are vested based upon tenure over a five -year period. Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Matching contributions $ 735 $ 626 $ 553 Discretionary contributions 3,617 5,350 5,207 Total contributions $ 4,352 $ 5,976 $ 5,760 Internationally, the Company contributes to either plans required by local governments or to various employee annuity plans. Additionally, the Company maintains a non-qualified, unfunded, deferred compensation plan that allows eligible executives to defer a portion of their compensation in addition to receiving discretionary matching contributions from the Company. Employer contributions are vested over a five -year period. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income tax expense (benefit) consists of: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Current: Federal $ 21,855 $ 24,658 $ 25,895 State 1,652 1,639 2,439 Foreign 6,100 4,927 3,826 Total current 29,607 31,224 32,160 Deferred: Federal 3,990 2,165 7,933 State 365 198 725 Foreign (1,571 ) 900 500 Total deferred 2,784 3,263 9,158 Provision for income taxes $ 32,391 $ 34,487 $ 41,318 A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) U.S. Federal income tax at statutory rate $ 33,603 $ 34,967 $ 43,088 Increase (decrease) in income taxes due to: State and local income taxes, net of Federal benefit 1,578 1,318 1,974 Tax credits (2,517 ) (1,435 ) (1,935 ) Valuation allowance 541 582 803 Effect of foreign operations, net (1,150 ) (1,665 ) (1,627 ) Stock compensation (62 ) (419 ) (494 ) Capitalized acquisition costs 70 839 — Other 328 300 (491 ) Provision for income taxes $ 32,391 $ 34,487 $ 41,318 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: June 30, 2016 2015 (in thousands) Deferred tax assets derived from: Allowance for accounts receivable $ 12,458 $ 9,925 Inventories 4,799 5,235 Nondeductible accrued expenses 3,842 5,838 Net operating loss carryforwards 3,036 2,223 Tax credits 3,316 2,136 Timing of amortization deduction from goodwill 2,660 10,652 Deferred compensation 6,733 6,014 Stock compensation 6,014 5,730 Timing of amortization deduction from intangible assets 1,600 83 Total deferred tax assets 44,458 47,836 Valuation allowance (3,029 ) (2,509 ) Total deferred tax assets, net of allowance 41,429 45,327 Deferred tax liabilities derived from: Timing of depreciation and other deductions from building and equipment (6,827 ) (549 ) Timing of amortization deduction from goodwill (5,370 ) (4,908 ) Timing of amortization deduction from intangible assets (2,974 ) (4,680 ) Total deferred tax liabilities (15,171 ) (10,137 ) Net deferred tax assets $ 26,258 $ 35,190 The components of pretax earnings are as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Domestic $ 76,062 $ 79,364 $ 104,685 Foreign 19,948 20,542 18,422 Worldwide pretax earnings $ 96,010 $ 99,906 $ 123,107 As of June 30, 2016 , there were (i) gross net operating loss carryforwards of approximately $1.4 million for state income tax purposes; (ii) foreign gross net operating loss carryforwards of approximately $9.0 million ; (iii) state income tax credit carryforwards of approximately $1.3 million that will began to expire in 2018; and (iv) withholding tax credits of approximately $2.4 million ; and (v) foreign tax credits of less than $0.1 million . The Company maintains a valuation allowance of $0.2 million for foreign net operating losses; a less than $0.1 million valuation allowance for state net operating losses, a $2.4 million valuation allowance for withholding tax credits, and a $0.3 million valuation allowance for the notional interest deduction, where it was determined that, in accordance with ASC 740, it is more likely than not that they cannot be utilized. The Company has provided for U.S. income taxes for the current earnings of its Canadian subsidiary. Earnings from all other geographies will continue to be considered retained indefinitely for reinvestment. The Company has not provided U.S. income taxes for undistributed earnings of foreign subsidiaries that are considered to be retained indefinitely for reinvestment. The distribution of these earnings would result in additional foreign withholding taxes and additional U.S. federal income taxes to the extent they are not offset by foreign tax credits. It has been the practice of the Company to reinvest those earnings in the business outside the United States. These undistributed earnings amounted to approximately $108 million at June 30, 2016 . If these earnings were remitted to the U.S., they would be subject to income tax. The tax, after foreign tax credits, is estimated to be approximately $19.2 million . Financial results in Belgium for the year ended June 30, 2016 produced pre-tax loss of approximately $1.2 million . To the extent the Belgium business does not return to profitability as expected, this could affect the valuation of certain deferred tax assets. However, the Belgium business reported taxable income in the two prior years and positive cumulative earnings over the most recent three-year period. In the judgment of management, the conditions that gave rise to the fiscal 2016 losses are temporary and that it is more likely than not that the deferred tax asset will be realized. As of June 30, 2016 , the Company had gross unrecognized tax benefits of $2.1 million , $1.3 million of which, if recognized, would affect the effective tax rate. This reflects an increase of $0.5 million on a net basis over the prior fiscal year. The Company does not expect that the total amounts of unrecognized tax benefits will significantly increase or decrease within the next twelve months. The Company recognizes interest and penalties related to unrecognized tax benefits within the income tax expense line in the accompanying Consolidated Income Statement. Accrued interest and penalties are included within the related tax liability line in the Consolidated Balance Sheet. The total amount of interest and penalties accrued, but excluded from the table below were $1.2 million the fiscal years ending June 30, 2016 and 2015 , and $1.1 million for the fiscal year ended June 30, 2014 , respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: June 30, 2016 2015 2014 (in thousands) Beginning Balance $ 1,301 $ 1,153 $ 1,034 Additions based on tax positions related to the current year 326 262 204 Additions for tax positions of prior years 658 — — Reduction for tax positions of prior years (137 ) (114 ) (85 ) Ending Balance $ 2,148 $ 1,301 $ 1,153 The Company conducts business globally and, as a result, one or more of its subsidiaries files income tax returns in the U.S. federal, various state, local and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities in countries in which it operates. With certain exceptions, the Company is no longer subject to state and local, or non-U.S. income tax examinations by tax authorities for tax years before June 30, 2011 . |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases The Company leases office and warehouse space under non-cancelable operating leases that expire through 2020. The Company also leases certain equipment under a capital lease that expires in 2017. Lease expense and future minimum lease payments under operating leases and the single capital lease are as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Lease expense $ 7,394 $ 6,168 $ 5,561 Operating Lease Payments Capital Lease Payments Total Payments (in thousands) Fiscal Year Ended June 30, 2017 $ 6,828 $ 248 $ 7,076 2018 3,670 — 3,670 2019 1,825 — 1,825 2020 1,146 — 1,146 2021 478 — 478 Thereafter 28 — 28 Total future minimum lease payments 13,975 248 14,223 Less: amounts representing interest on capital lease — 2 2 Total future minimum principal lease payments $ 13,975 $ 246 $ 14,221 On April 27, 2007, the Company entered into an agreement to lease approximately 593,000 square feet for distribution, warehousing and storage purposes in a building located in Southaven, Mississippi. On July 6, 2016, the Company entered into an amended lease agreement; see Note 16 - Subsequent Events for further information regarding the new lease terms effective for fiscal year 2017. On June 3, 2014, the Company entered into an equipment lease transaction for certain information technology infrastructure located in the Greenville, South Carolina facility. The Company determined this lease qualifies as a capital lease and accordingly, has recorded a capital lease obligation equal to the present value of the minimum lease payments of $0.7 million . The lease term is 3 years with an expiration date during 2017. The components of the Company's capital lease as of June 30, 2016 are as follows: Capital Lease Obligations Property & Equipment Accumulated Depreciation Net Book Value Short-Term Long-Term Total (in thousands) IT Infrastructure $ 731 $ 487 $ 244 $ 246 $ — $ 246 Commitments and Contingencies A majority of the Company’s net revenues in fiscal years 2016 , 2015 and 2014 were received from the sale of products purchased from the Company’s ten largest vendors. The Company has entered into written distribution agreements with substantially all of its major vendors. While the Company’s agreements with most of its vendors contain standard provisions for periodic renewals, these agreements generally permit termination by either party without cause upon 30 to 120 days' notice. The Company or its subsidiaries are, from time to time, parties to lawsuits arising out of operations. Although there can be no assurance, based upon information known to the Company, the Company believes that any liability resulting from an adverse determination of such lawsuits would not have a material adverse effect on the Company’s financial condition or results of operations. In January 2013, through the Company's wholly-owned subsidiary Partner Services, Inc. ("PSI"), the Company filed a lawsuit in the U.S. District Court in Atlanta, Georgia against our former ERP software systems integration partner, Avanade, Inc. ("Avanade"). In June 2014, the parties reached a Settlement Agreement where both parties agreed to mutually dismiss all claims and counterclaims against the other in exchange for Avanade's payment to the Company of $15.0 million . The Company also reversed $2.0 million in accrued liabilities for unpaid invoices received from Avanade and paid a contingency fee of $1.5 million to the law firm who represented the Company in the lawsuit. The settlement, net of attorney fees and reversal of accrued liabilities is included in the legal recovery line item on the Consolidated Income Statements for the year ended June 30, 2014. Capital Projects The Company implemented a new Enterprise Resource Planning ("ERP") system in its European operations, excluding Imago ScanSource, in fiscal year 2015 and in its North American operations in fiscal year 2016. The Company intends to implement the ERP system in other geographies during fiscal year 2017 and expects capital expenditures for this project to approximate $1.5 million . The Company expects total capital expenditures to range from $3.0 million to $8.0 million during fiscal year 2017. Pre-Acquisition Contingencies During the Company's due diligence for the CDC acquisition, several pre-acquisition contingencies were identified regarding various Brazilian federal and state tax exposures. In connection with these contingencies, the Company recorded indemnification receivables that are reported gross of the pre-acquisition contingency liabilities as the funds were escrowed as part of the acquisition. During fiscal year 2016, the Company released $4.1 million from the escrow account to the sellers after the final earnout payment was made. The amount available after the impact of foreign currency translation, as of June 30, 2016 and 2015 for future pre-acquisition contingency settlements or to be released to the sellers, was $3.5 million and $8.4 million , respectively. The table below summarizes the balances and line item presentation of CDC's pre-acquisition contingencies and corresponding indemnification receivables in the Company's consolidated balance sheet: June 30, 2016 June 30, 2015 (in thousands) Assets Prepaid expenses and other assets (current) $ 2,346 $ 3,156 Other assets (noncurrent) $ — $ 69 Liabilities Other current liabilities $ 2,346 $ 3,156 Other long-term liabilities $ — $ 69 The change in classification and amounts of the pre-acquisition contingencies is primarily due to foreign currency translation on a weaker Brazilian real against the U.S. dollar and the expiration of the statute of limitations for identified pre-acquisition contingencies. The amount of reasonably possible undiscounted pre-acquisition contingencies as of June 30, 2016 is estimated to range as high as $3.5 million at this time, of which all exposures are indemnifiable under the share purchase and sale agreement. During the Company's due diligence for the Network1 acquisition, several pre-acquisition contingencies were identified regarding various Brazilian federal and state tax exposures. The Company recorded indemnification receivables that are reported gross of the pre-acquisition contingency liabilities as the funds were escrowed as part of the acquisition. The amount available after the impact of foreign currency translation, as of June 30, 2016 and 2015 for future pre-acquisition contingency settlements or to be released to the sellers, was $4.7 million and $3.2 million , respectively. The table below summarizes the balances and line item presentation of Network1's pre-acquisition contingencies and corresponding indemnification receivables in the Company's consolidated balance sheet: June 30, 2016 June 30, 2015 (in thousands) Assets Prepaid expenses and other assets (current) $ 595 $ 520 Other assets (noncurrent) $ 9,837 $ 10,769 Liabilities Other current liabilities $ 595 $ 520 Other long-term liabilities $ 9,837 $ 10,769 The amount of reasonably possible undiscounted pre-acquisition contingencies as of June 30, 2016 is estimated to range from $9.9 million to $31.0 million at this time, of which all exposures are indemnifiable under the share purchase agreement. |
Segment Information
Segment Information | 12 Months Ended |
Jun. 30, 2016 | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Segment Information | Segment Information The Company is a leading provider of technology products and solutions to resellers in specialty technology markets. The Company has two reportable segments, based on product, customer and service type. In October 2015, we implemented changes to our reporting structure that moved a portion of our networking business from the Communications & Services segment to the Barcode & Security segment. We have reclassified prior period results for each of these business segments to provide comparable information. Worldwide Barcode & Security Segment The Barcode & Security segment focuses on automatic identification and data capture ("AIDC"), point-of-sale ("POS"), networking, electronic physical security, and 3D printing technologies. We have business units within this segment for sales and merchandising functions, including ScanSource POS and Barcode business units in North America, Latin America, and Europe and the ScanSource Security business unit in North America. We see adjacencies among these technologies in helping our resellers develop solutions, such as with networking products. AIDC and POS products interface with computer systems used to automate the collection, processing and communication of information for commercial and industrial applications, including retail sales, distribution, shipping, inventory control, materials handling, warehouse management and health care applications. Electronic physical security products include identification, access control, video surveillance, intrusion-related and wireless and networking infrastructure products. 3D printing solutions replace and complement traditional methods and reduce the time and cost of designing new products by printing real parts directly from digital input. Worldwide Communications & Services Segment The Communications & Services segment focuses on communications technologies and services. We have business units within this segment for sales and merchandising functions, and these business units offer voice, video conferencing, wireless, data networking and converged communications solutions in North America, Latin America, and Europe. As these solutions come together on IP networks, new opportunities are created for value-added resellers to move into adjacent solutions for all vertical markets, including education, healthcare, and government. Our teams deliver value-added support programs and services, including education and training, network assessments, custom configuration, implementation and marketing to help resellers develop a new technology practice, or to extend their capability and reach. Selected financial information for each business segment is presented below: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Sales: Worldwide Barcode & Security $ 2,381,331 $ 2,134,124 $ 2,003,911 Worldwide Communications & Services 1,158,895 1,084,502 909,723 $ 3,540,226 $ 3,218,626 $ 2,913,634 Depreciation and amortization: Worldwide Barcode & Security $ 5,663 $ 3,813 $ 4,243 Worldwide Communications & Services 8,531 6,912 3,132 Corporate 2,960 1,272 — $ 17,154 $ 11,997 $ 7,375 Operating income: Worldwide Barcode & Security $ 53,015 $ 49,045 $ 49,544 Worldwide Communications & Services 44,725 55,650 56,752 Corporate (1) (863 ) (3,254 ) 15,490 $ 96,877 $ 101,441 $ 121,786 Capital expenditures: Worldwide Barcode & Security $ 5,310 $ 733 $ 784 Worldwide Communications & Services 3,911 1,448 316 Corporate 2,860 18,581 10,128 $ 12,081 $ 20,762 $ 11,228 Sales by Geography Category: United States $ 2,655,760 $ 2,391,073 $ 2,225,962 International 920,098 871,862 733,744 Less intercompany sales (35,632 ) (44,309 ) (46,072 ) $ 3,540,226 $ 3,218,626 $ 2,913,634 (1) For the years ended June 30, 2016 and 2015, the amounts shown above includes acquisition costs. For the year ended June 30, 2014, the amount shown above includes a legal recovery, net of attorney fees. June 30, 2016 June 30, 2015 (in thousands) Assets: Worldwide Barcode & Security $ 836,674 $ 740,020 Worldwide Communications & Services 595,781 599,358 Corporate 58,730 137,563 $ 1,491,185 $ 1,476,941 Property and equipment, net by Geography Category: United States $ 46,935 $ 41,159 International 5,453 5,415 $ 52,388 $ 46,574 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Jun. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | Accumulated Other Comprehensive (Loss) Income The components of accumulated other comprehensive (loss) income, net of tax, are as follows: Fiscal Years Ended June 30, 2016 2015 2014 (in thousands) Currency translation adjustment $ (72,687 ) $ (64,502 ) $ (16,700 ) Accumulated other comprehensive income (loss) $ (72,687 ) $ (64,502 ) $ (16,700 ) The tax effect of amounts in comprehensive income (loss) reflect a tax expense or benefit as follows: Fiscal years ended June 30, 2016 2015 2014 (in thousands) Tax expense (benefit) $ 327 $ 2,382 $ (279 ) |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On August 8, 2016 the Company announced a definitive agreement to acquire Intelisys Communications, Inc., the industry-leading technology services distributor of business telecommunications and cloud services. Under the agreement, the all-cash transaction includes an initial purchase price of approximately $83.6 million ( $8.46 million of which will be held in escrow to support the post-closing obligations of the sellers), plus annual earn-out payments based on a multiple of earnings before interest expense, taxes, depreciation and amortization (EBITDA) over the next four years. The total earnout-payments are estimated to be in the range of $100 million to $150 million , depending on the performance of the business. Intelisys will join the Worldwide Communications and Services segment. The acquisition received regulatory approval on August 25, 2016 and closed on August 29, 2016. Due to the timing of the acquisition relative to the annual filing, the Company is not able to present initial accounting estimates for the business combination, including purchase price allocation, valuation of tangible and intangible assets (including goodwill), valuation of the contingent consideration, and pro-forma results of operations. On July 6, 2016, the Company entered into an amended lease agreement for our warehouse located in Southaven, Mississippi, which extended the square footage leased by approximately 148,000 scheduled to be delivered on October 1, 2017, for a total leased space of approximately 741,000 square feet, and further extended the term of the lease to 135 months with 2 consecutive 5 -year extension options. On August 29, 2016 , the Company announced a new $120 million three -year authorization by its Board of Directors to repurchase shares of the Company’s common stock. Repurchases may be made in the open market or through privately negotiated transactions, and the Company may enter into Rule 10b5-1 plans to facilitate repurchases. |
Valuation And Qualifying Accoun
Valuation And Qualifying Accounts | 12 Months Ended |
Jun. 30, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
Valuation And Qualifying Accounts | SCHEDULE II SCANSOURCE, INC. AND SUBSIDIARIES Valuation and Qualifying Accounts (in thousands) Description Balance at Beginning of Period Amounts Charged to Expense Reductions (1) Other (2) Balance at End of Period Allowance for bad debt: Year ended June 30, 2014 $ 25,479 6,573 (8,100 ) 2,305 $ 26,257 Trade and current note receivable allowance $ 26,257 Year ended June 30, 2015 $ 26,257 993 (8,288 ) 13,627 $ 32,589 Trade and current note receivable allowance $ 32,589 Year ended June 30, 2016 $ 32,589 7,571 (3,829 ) 2,701 $ 39,032 Trade and current note receivable allowance $ 39,032 (1) "Reductions" amounts represent write-offs for the years indicated. (2) "Other" amounts include recoveries and the effect of foreign currency fluctuations for years ended June 30, 2016 , 2015 , and 2014 . In addition, the amount in 2016 includes $1.5 million of recoveries and $1.2 million of accounts receivable acquired with KBZ on September 4, 2016. The amount in 2015 includes $3.9 million of recoveries, $1.1 million of accounts receivable reserves acquired with Imago Group plc on September 19, 2014, and $12.8 million of accounts receivable reserves acquired with Network 1 on January 13, 2015. |
Business and Summary of Signi25
Business and Summary of Significant Accounting Policies (Policy) | 12 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Business Description | Business Description ScanSource , Inc. is a leading global provider of technology products and solutions. ScanSource, Inc. and its subsidiaries ("the Company") provide value-added solutions for technology manufacturers and sell to resellers in specialty technology markets through its Worldwide Barcode & Security segment and Worldwide Communications & Services segment. The Company's two operating segments are based on product, customer and service type. The Company operates in the United States, Canada, Latin America and Europe. The Company sells to the United States and Canada from its distribution centers located in Mississippi and Virginia; to Latin America principally from distribution centers located in Florida, Mexico, Brazil and Colombia; and to Europe from distribution centers located in Belgium, France, Germany and the United Kingdom. |
Consolidation Policy | Consolidation Policy The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant inter-company accounts and transactions have been eliminated |
Related Party Transactions | Related Party Transactions A related party is generally defined as (i) any person that holds 10% or more of the Company’s securities and their immediate families, (ii) the Company’s management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. There were no material related party transactions for the fiscal years ended June 30, 2016 , 2015 , and 2014 . |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to the allowance for uncollectible accounts receivable, contingent consideration, and inventory reserves. Management bases its estimates on assumptions that management believes to be reasonable under the circumstances, the results of which form a basis for making judgments about the carrying value of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates under different assumptions or conditions; however, management believes that its estimates, including those for the above described items, are reasonable and that the actual results will not vary significantly from the estimated amounts. |
Allowances for Trade and Notes Receivable | Allowances for Trade and Notes Receivable The Company maintains an allowance for uncollectible accounts receivable for estimated losses resulting from customers’ failure to make payments on accounts receivable due to the Company. Management determines the estimate of the allowance for uncollectible accounts receivable by considering a number of factors, including: (1) historical experience, (2) aging of the accounts receivable, (3) specific information obtained by the Company on the financial condition and the current creditworthiness of its customers, and (4) the current economic and country specific environment. If the financial condition of the Company’s customers were to deteriorate and reduce the ability of the Company’s customers to make payments on their accounts, the Company may be required to increase its allowance by recording additional bad debt expense. Likewise, should the financial condition of the Company’s customers improve and result in payments or settlements of previously reserved amounts, the Company may be required to record a reduction in bad debt expense to reverse the recorded allowance. |
Inventory Reserves | Inventory Reserves Management determines the inventory reserves required to reduce inventories to the lower of cost or market based principally on the effects of technological changes, quantities of goods and length of time on hand, and other factors. An estimate is made of the market value, less cost to dispose, of products whose value is determined to be impaired. If these products are ultimately sold at less than estimated amounts, additional reserves may be required. The estimates used to calculate these reserves are applied consistently. The adjustments are recorded in the period in which the loss of utility of the inventory occurs, which establishes a new cost basis for the inventory. This new cost basis is maintained until such time that the reserved inventory is disposed of, returned to the vendor or sold. To the extent that specifically reserved inventory is sold, cost of goods sold is expensed for the new cost basis of the inventory sold. |
Purchase Price Allocations | Purchase Price Allocations For each acquisition, the Company allocates the purchase price to assets acquired, liabilities assumed, and goodwill and intangibles in accordance with ASC 805. We recognize assets and liabilities acquired at the their estimated fair values. Management uses judgment to (1) identify the acquired assets and liabilities assumed, (2) estimate the fair value of these assets, (3) estimate the useful life of the assets, and (4) assess the appropriate method for recognizing depreciation or amortization expense over the asset’s useful life. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less, when purchased, to be cash equivalents. The Company maintains some zero-balance disbursement accounts at various financial institutions in which the Company does not maintain significant depository relationships. Due to the nature of the Company’s banking relationships with these institutions, the Company does not have the right to offset most if not all outstanding checks written from these accounts against cash on hand, and the respective institutions are not legally obligated to honor the checks until sufficient funds are transferred to fund the checks. Checks released but not yet cleared from these accounts in the amounts of $78.3 million and $62.9 million are classified as accounts payable as of June 30, 2016 and June 30, 2015 , respectively. The Company maintains its cash with various financial institutions globally that are monitored regularly for credit quality and holds amounts in excess of Federal Deposit Insurance Corporation ("FDIC") limits or other insured limits. Cash and cash equivalents held outside of the United States totaled $52.7 million and $43.4 million as of June 30, 2016 and 2015 , respectively. |
Concentration of Credit Risk | Concentration of Credit Risk The Company sells to a large base of value-added resellers throughout the United States, Canada, Latin America and Europe. The Company performs ongoing credit evaluations of its customers’ financial condition. In certain cases, the Company will accept tangible assets as collateral to increase the trade credit of its customers. In addition, the Company carries credit insurance on certain subsections of the customer portfolio. No single customer accounted for more than 5% of the Company’s net sales for fiscal years 2016 , 2015 , or 2014 . The Company has established arrangements with certain customers for longer-term financing. The Company accounts for these arrangements by recording them at their historical cost less specific allowances at balance sheet dates. Interest income is recognized in the period earned and is recorded as interest income in the Consolidated Income Statement. |
Derivative Financial Instruments | Derivative Financial Instruments The Company uses derivative instruments to manage certain exposures related to fluctuations in foreign currency exchange rates and changes in interest rates in connection with borrowing activities. We record all derivative instruments as either assets or liabilities in the Consolidated Balance Sheet at fair value. The Company does not use derivative financial instruments for trading or speculative purposes. The Company’s foreign currency exposure results from purchasing and selling internationally in several foreign currencies and from intercompany loans with foreign subsidiaries. In addition, the Company may have foreign currency risk related to debt that is denominated in currencies other than the U.S. dollar. The Company's foreign currencies are denominated primarily in Brazilian reais, euros, British pounds, Canadian dollars, Mexican pesos, Colombian pesos, Chilean pesos, and Peruvian nuevos. The Company may reduce its exposure to fluctuations in foreign exchange rates by creating offsetting positions through the use of derivative financial instruments. The market risk related to the foreign exchange agreements is offset by changes in the valuation of the underlying items. These contracts are generally for a duration of 90 days or less. The Company has elected not to designate its foreign currency contracts as hedging instruments. They are, therefore, marked-to-market with changes in their fair value recorded in the Consolidated Income Statement each period. Derivative financial instruments related to foreign currency exposure are accounted for on an accrual basis with gains or losses on these contracts recorded in income in the period in which their value changes, with the offsetting entry for unsettled positions reflected in either other assets or other liabilities. During the fiscal year ended June 30, 2015, through the acquisition of Network1, the Company assumed borrowings denominated in foreign currencies that were hedged into the functional currency of the respective borrowing entity using cross-currency swaps in order to mitigate the impact of foreign currency exposures and interest rate exposures on these borrowings. These swaps involved the exchange of principal and fixed interest receipts of U.S. dollar-denominated debt held by one of our Brazilian subsidiaries (Network1) for principal and variable interest payments in Brazilian reais. The impact of the changes in foreign exchange rates of the cross-currency debt instruments were recognized as adjustments to other income and expense in the Consolidated Income Statements. Interest rate differentials paid or received under the swap agreements were recognized as adjustments to interest expense in the Consolidated Income Statements. |
Investments | Investments The Company has investments that are held in a grantor trust formed by the Company related to the ScanSource, Inc. Nonqualified Deferred Compensation Plan and Founder’s Supplemental Executive Retirement Plan ("SERP"). The Company has classified these investments as trading securities, and they are recorded at fair market value with unrealized gains and losses included in the accompanying Consolidated Income Statements. The Company’s obligations under this deferred compensation plan change in concert with the performance of the investments along with contributions to and withdrawals from the plan. The fair value of these investments and the corresponding deferred compensation obligation was $17.9 million and $16.0 million as of June 30, 2016 and June 30, 2015 , respectively. These investments are classified as either prepaid expenses and current assets or other non-current assets in the Consolidated Balance Sheets depending on the timing of planned disbursements. The deferred compensation obligation is classified either within accrued expenses and other current liabilities or other long-term liabilities as well. The amounts of these investments classified as current assets with corresponding current liabilities were $1.6 million and $0.7 million at June 30, 2016 and June 30, 2015 , respectively. |
Inventories | Inventories Inventories (consisting entirely of finished goods) are stated at the lower of cost (first-in, first-out method) or market. |
Vendor Programs | Vendor Programs The Company receives incentives from vendors related to cooperative advertising allowances, volume rebates and other incentive agreements. These incentives are generally under quarterly, semi-annual or annual agreements with the vendors. Some of these incentives are negotiated on an ad hoc basis to support specific programs mutually developed between the Company and the vendor. Vendors generally require that we use their cooperative advertising allowances exclusively for advertising or other marketing programs. Incentives received from vendors for specifically identified incremental cooperative advertising programs are recorded as adjustments to selling, general and administrative expenses. FASB's Accounting Standards Codification ("ASC") 605 – Revenue Recognition , addresses accounting by a customer (including a reseller) for certain consideration received from a vendor. This guidance requires that the portion of these vendor funds in excess of our costs be reflected as a reduction of inventory. Such funds are recognized as a reduction of the cost of goods sold when the related inventory is sold. The Company records unrestricted volume rebates received as a reduction of inventory a reduction of the cost of goods sold when the related inventory is sold. Amounts received or receivables from vendors that are not yet earned are deferred in the Consolidated Balance Sheets. In addition, the Company may receive early payment discounts from certain vendors. The Company records early payment discounts received as a reduction of inventory, thereby resulting in a reduction of cost of goods sold when the related inventory is sold. ASC 605 requires management to make certain estimates of the amounts of vendor incentives that will be received. Actual recognition of the vendor consideration may vary from management estimates. |
Vendor Concentration | Vendor Concentration The Company sells products from many vendors, however, sales of products supplied by Avaya, Cisco, and Zebra each constituted more than 10% of the Company’s net sales for the year ended June 30, 2016 . For the year ended June 30, 2015 , sales of products supplied by Avaya and Zebra each constituted more than 10% of the Company's net sales. Sales of products supplied by Avaya, Honeywell, and Zebra constituted more than 10% of the Company's net sales for the year ended June 30, 2014 . |
Product Warranty | Product Warranty The Company’s vendors generally provide a warranty on the products provided by the Company and allow the Company to return defective products, including those that have been returned to the Company by its customers. In three of our product lines, the Company offers a self-branded warranty program, in which management has determined that the Company is the primary obligor. The Company purchases contracts from unrelated third parties, generally the original equipment manufacturers, to fulfill any obligation to service or replace defective product claimed on these warranty programs. As a result, the Company has not recorded a provision for estimated service warranty costs. For all other product lines, the Company does not independently provide a warranty on the products it sells; however, to maintain customer relations, the Company facilitates returns of defective products from the Company’s customers by accepting for exchange, with the Company’s prior approval, most defective products within 30 days of invoicing. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost. Depreciation is computed using the straight-line method over estimated useful lives of 3 to 10 years for furniture, equipment and computer software, 40 years for buildings and 15 years for building improvements. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life. Maintenance, repairs and minor renewals are charged to expense as incurred. Additions, major renewals and betterments to property and equipment are capitalized. To the extent that the Company has longstanding, "in-process" projects that have not been implemented for their intended operational use, the Company capitalizes the portion of interest expense incurred during the asset's acquisition period that theoretically could have been avoided in accordance with ASC 835. The amount capitalized is determined by applying the appropriate capitalization rate to the average amount of accumulated expenditures for the asset during the reporting period. The capitalization rate used is based on the rates applicable to borrowings outstanding during the reporting period. |
Capitalized Software | Capitalized Software The Company accounts for capitalized software in accordance with ASC 350-40, which provides guidance for computer software developed or obtained for internal use. The Company is required to continually evaluate the stage of the implementation process to determine whether or not costs are expensed or capitalized. Costs incurred during the preliminary project phase or planning and research phase are expensed as incurred. Costs incurred during the development phase, such as material and direct services costs, compensation costs of employees associated with the development, and interest cost, are capitalized as incurred. Costs incurred during the post-implementation or operation phase, such as training and maintenance costs, are expensed as incurred. In addition, costs incurred to modify existing software that result in additional functionality are capitalized as incurred. |
Goodwill | Goodwill The Company accounts for recorded goodwill in accordance with ASC 350, Goodwill and Other Intangible Assets , which requires that goodwill be reviewed annually for impairment or more frequently if impairment indicators exist. Goodwill testing utilizes a two-step impairment analysis, whereby the Company compares the carrying value of each identified reporting unit to its fair value. The carrying value of goodwill is reviewed at a reporting unit level at least annually for impairment, or more frequently if impairment indicators exist. Our goodwill reporting units align directly with our operating segments, Barcode & Security and Communications & Services. The fair values of the reporting units are estimated using the net present value of discounted cash flows generated by each reporting unit. Considerable judgment is necessary in estimating future cash flows, discount rates and other factors affecting the estimated fair value of the reporting units, including the operating and macroeconomic factors. Historical financial information, internal plans and projections, and industry information are used in making such estimates. In the two-step impairment analysis, goodwill is first tested for impairment by comparing the fair value of the reporting unit with the reporting unit's carrying amount to identify any potential impairment. If fair value is determined to be less than carrying value, a second step is used whereby the implied fair value of the reporting unit's goodwill, determined through a hypothetical purchase price allocation, is compared with the carrying amount of the reporting units' goodwill. If the implied fair value of the reporting unit's goodwill is less than its carrying amount, an impairment charge is recorded in current earnings for the difference. We also assess the recoverability of goodwill if facts and circumstances indicate goodwill may be impaired. In our most recent annual test, we estimated the fair value of our reporting units primarily based on the income approach utilizing the discounted cash flow method. We also utilized fair value estimates derived from the market approach utilizing the public company market multiple method to validate the results of the discounted cash flow method, which required us to make assumptions about the applicability of those multiples to our reporting units. The discounted cash flow method required us to estimate future cash flows and discount those amounts to present value. The key assumptions utilized in determining fair value included: • Industry weighted-average cost of capital ("WACC"): We utilized a WACC relative to each reporting unit's respective geography and industry as the discount rate for estimated future cash flows. The WACC is intended to represent a rate of return that would be expected by a market place participant in each respective geography. • Operating income: We utilized historical and expected revenue growth rates, gross margins and operating expense percentages, which varied based on the projections of each reporting unit being evaluated. • Cash flows from working capital changes: We utilized a projected cash flow impact pertaining to expected changes in working capital as each of our goodwill reporting units grow. See Note 6 - Goodwill and Other Identifiable Intangible Assets for more information regarding goodwill and the results of our testing. |
Intangible Assets | Intangible Assets Intangible assets consist of customer relationships, trade names, distributor agreements and non-compete agreements. Customer relationships and distributor agreements are amortized using the straight-line method over their estimated useful lives, which range from 5 to 15 years. Trade names are amortized over a period ranging from 1 to 5 years. Non-compete agreements are amortized over their contract life. Debt issuance costs are amortized over the term of the credit facility. These assets are shown in detail in Note 6 - Goodwill and Other Identifiable Intangible Assets |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset or asset group may not be recoverable. Tests for recoverability of a long-lived asset to be held and used are measured by comparing the carrying amount of the long-lived asset to the sum of the estimated future undiscounted cash flows expected to be generated by the asset. In estimating the future undiscounted cash flows we use projections of cash flows directly associated with, and which are expected to arise as a direct result of, the use and eventual disposition of the assets. If it is determined that a long-lived asset is not recoverable, an impairment loss would be calculated equal to the excess of the carrying amount of the long-lived asset over its fair value. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The fair value of financial instruments is the amount at which the instrument could be exchanged in a current transaction between willing parties. The carrying values of financial instruments such as accounts receivable, accounts payable, accrued liabilities, borrowings under the revolving credit facility and subsidiary lines of credit approximate fair value based upon either short maturities or variable interest rates of these instruments. For additional information related to the fair value of derivatives, please see Note 9 - Fair Value of Financial Instruments . |
Liability for Contingent Consideration | Liability for Contingent Consideration In addition to the initial cash consideration paid to former shareholders of CDC, Imago, and Network1, the Company is obligated to make additional earnout payments based on future results through a specified date based on a multiple of the subsidiary’s pro forma earnings measure as defined in the respective share purchase agreements. Future payments are to be paid in the subsidiary's local currency. In accordance with ASC 805, the Company determined the fair value of this liability for contingent consideration on the respective acquisition dates using a form of a probability-weighted discounted cash flow model following the income approach. Each period, the Company reflects the contingent consideration liability at fair value with changes recorded in the change in fair value of contingent consideration line item in the Consolidated Income Statements. The final earnout payment to the former shareholders of CDC was paid during fiscal year 2016. |
Contingencies | Contingencies The Company accrues for contingent obligations, including estimated legal costs, when it is probable that a liability is incurred and the amount is reasonably estimable. As facts concerning contingencies become known, management reassesses its position and makes appropriate adjustments to the financial statements. Estimates that are particularly sensitive to future changes include tax, legal, and other regulatory matters, which are subject to change as events evolve, and as additional information becomes available during the administrative and litigation process. |
Revenue Recognition | Revenue Recognition Revenue is recognized once four criteria are met: (1) the Company must have persuasive evidence that an arrangement exists; (2) delivery must occur (this includes the transfer of both title and risk of loss, provided that no significant obligations remain); (3) the price must be fixed and determinable; and (4) collectability must be reasonably assured. The Company allows its customers to return product for exchange or credit subject to certain limitations. The Company provides third-party service contracts, typically for product maintenance and support. These service contracts are sold separately from the products, and the Company often serves as the agent for the contract on behalf of the original equipment manufacturer. Since the Company acts as an agent on behalf of most of these service contracts sold, revenue is recognized net of cost at the time of sale. However, the Company provides some self-branded warranty programs and engages a third party (generally the original equipment manufacturer) to cover the fulfillment of any obligations arising from these contracts. These revenues and associated third-party costs are amortized over the life of the contract and presented in net sales and cost of goods sold, respectively. Service revenue associated with third-party service contracts and warranty programs, as mentioned above, along with configuration and marketing services is recognized when the work is complete, and the four criteria discussed above have been substantially met. Service revenue associated with service contracts, warranty programs, configuration, marketing and other services approximates 3% of consolidated net sales for fiscal years 2016 and 2015 , compared to 2% of consolidated net sales for fiscal year 2014 . During the fiscal years ended June 30, 2016 , 2015 and 2014 , the Company did not engage in sales transactions involving multiple element arrangements. |
Shipping Revenue and Costs | Shipping Revenue and Costs Shipping revenue is included in net sales, and related costs are included in cost of goods sold. Shipping revenue was $13.0 million for the year ended June 30, 2016 and $12.2 million for the years ended June 30, 2015 and 2014 , respectively. |
Advertising Costs | Advertising Costs The Company defers advertising-related costs until the advertising is first run in trade or other publications, or in the case of brochures, until the brochures are printed and available for distribution. Advertising costs, included in marketing costs, after vendor reimbursement, were not significant in any of the three fiscal years ended June 30, 2016 . Deferred advertising costs for any of the three fiscal years ended June 30, 2016 were also not significant. |
Foreign Currency | Foreign Currency The currency effects of translating the financial statements of the Company’s foreign entities that operate in their local currency are included in the cumulative currency translation adjustment component of accumulated other comprehensive income or loss. The Company's functional currencies include U.S. dollars, Brazilian reais, euros, British pounds, and Canadian dollars. The assets and liabilities of these foreign entities are translated into U.S. dollars using the exchange rate at the end of the respective period. Sales, costs and expenses are translated at average exchange rates effective during the respective period. Foreign currency transactional and re-measurement gains and losses are included in other expense (income) in the Consolidated Income Statements. Such amounts are not significant to any of the periods presented. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income taxes reflect tax consequences on future years of differences between the tax bases of assets and liabilities and their financial reporting amounts. Valuation allowances are provided against deferred tax assets when it is more likely than not that an asset will not be realized in accordance with ASC 740, Accounting for Income Taxes. In 2016, the Company adopted Accounting Standards Update ("ASU") 2015-17, Balance Sheet Classification of Deferred Taxes and reclassified all current deferred taxes and the related valuation allowances to noncurrent positions on the Consolidated Balance Sheets. The Company has provided for U.S. income taxes for the current earnings of its Canadian subsidiary. Earnings from all other geographies are considered retained indefinitely for reinvestment. See Note 12 - Income Taxes for further discussion. Additionally, the Company maintains reserves for uncertain tax provisions in accordance with ASC 740. See Note 12 - Income Taxes for more information. |
Share-Based Payments | Share-Based Payments The Company accounts for share-based compensation using the provisions of ASC 718, Accounting for Stock Compensation , which requires the recognition of the fair value of share-based compensation. Share-based compensation is estimated at the grant date based on the fair value of the awards, in accordance with the provisions of ASC 718. Since this compensation cost is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The Company has elected to expense grants of awards with graded vesting on a straight-line basis over the requisite service period for each separately vesting portion of the award. |
Comprehensive Income | Comprehensive Income ASC 220, Comprehensive Income , defines comprehensive income as the change in equity (net assets) of a business enterprise during a period from transactions and other events and circumstances from non-owner sources. The components of comprehensive income for the Company include net income and foreign currency translation adjustments arising from the consolidation of the Company’s foreign subsidiaries. Currently, the Company is not engaged in any cash flow hedges that qualify for hedge accounting. |
Business Combinations | Business Combinations The Company accounts for business combinations in accordance with ASC 805, Business Combinations . ASC 805 establishes principles and requirements for recognizing the total consideration transferred to and the assets acquired, liabilities assumed and any non-controlling interest in the acquired target in a business combination. ASC 805 also provides guidance for recognizing and measuring goodwill acquired in a business combination and requires the acquirer to disclose information that users may need to evaluate and understand the financial impact of the business combination. See Note 5 - Acquisitions for further discussion. |
Reclassifications | Reclassifications In accordance with ASU 2015-17, all prior year deferred income taxes that were previously classified as current assets and liabilities have been reclassified to non-current positions on the Consolidated Balance Sheets. The Company reclassified $20.6 million of deferred income tax previously classified as current assets to non-current assets as of June 30, 2015. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued a comprehensive new revenue recognition standard for contracts with customers that will supersede most current revenue recognition guidance, including industry-specific guidance. The core principle of this standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, the standard provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. This guidance also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. The new standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early application is prohibited. The standard permits the use of either the retrospective or cumulative effect transition method. This guidance will be applicable to the Company for the fiscal year beginning July 1, 2018. The Company is currently evaluating the impact on its consolidated financial statements upon the adoption of this new standard. In December 2015, the FASB issued final guidance requiring companies to classify all deferred tax assets and liabilities as noncurrent on the balance sheet rather than separating deferred taxes into current and noncurrent amounts. In addition, companies will also be required to classify valuation allowances on deferred taxes as noncurrent. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early application is permitted. The guidance may be adopted on either a prospective or retrospective basis. This guidance was adopted by the Company during fiscal year 2016. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) requiring lessees to reflect most leases on their balance sheets and recognize expenses on their income statements in a manner similar to current guidance. Under the new guidance, lessees will be required to recognize a lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis, and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. The asset will be measured at the lease liability amount, adjusted for lease prepayments, lease incentives received, and the lessee's initial direct costs. For leases with a lease term of 12 months or less, as long as the lease does not include options to purchase the underlying assets, lessees can elect not to recognize a lease liability and right-of-use asset. Under the new guidance, lessor accounting is largely unchanged, and the accounting for sale and leaseback transactions is simplified. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. This guidance will be applicable to the Company for the fiscal year beginning July 1, 2019. The guidance must be adopted using a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. The Company is currently evaluating the impact on its consolidated financial statements upon the adoption of this new guidance. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718) simplifying several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory withholding requirements, as well as classification in the statement of cash flows. Under the new guidance, an entity will recognize all excess tax benefits and tax deficiencies as income tax expense or benefit in the income statement. This change eliminates the current practice of recognizing excess tax benefits in additional paid-in-capital ("APIC") and tax deficiencies in APIC to the extent that there is a sufficient APIC pool related to previously recognized excess tax benefits. In addition, excess tax benefits and tax deficiencies are considered discrete items in the reporting period they occur and are not included in the estimate of an entity’s annual effective tax rate. As for classification on the statement of cash flows, excess tax benefits will no longer represent a financing activity since they are recognized in the income statement, and will appropriately be classified as an operating activity. The ASU allows an entity to elect as an accounting policy either to continue to estimate the total number of awards for which the requisite service period will not be rendered (as currently required) or to account for forfeitures when they occur. In regards to statutory withholding requirements, the new guidance stipulates that the net settlement of an award would not result, by itself, in liability classification of the award provided that the amount withheld for taxes does not exceed the maximum statutory tax rate in the employees’ relevant tax jurisdictions. The standard is effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. If early adoption is elected, all amendments in the ASU that apply must be adopted in the same period. This guidance will be applicable to the Company for the fiscal year beginning July 1, 2017. The Company is currently evaluating the impact on its consolidated financial statements upon the adoption of this new guidance. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings per Share | Fiscal Year Ended June 30, 2016 2015 2014 (in thousands, except per share data) Numerator: Net income $ 63,619 65,419 81,789 Denominator: Weighted-average shares, basic 26,472 28,558 28,337 Dilutive effect of share-based payments 215 241 265 Weighted-average shares, diluted 26,687 28,799 28,602 Net income per common share, basic $ 2.40 $ 2.29 $ 2.89 Net income per common share, diluted $ 2.38 $ 2.27 $ 2.86 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Components of Property and Equipment | Property and equipment is comprised of the following: June 30, 2016 2015 (in thousands) Land $ 3,009 $ 3,009 Buildings and leasehold improvements 20,473 21,266 Computer software and equipment 46,112 44,444 Furniture, fixtures and equipment 23,316 16,849 Construction in progress 4,897 126 97,807 85,694 Less accumulated depreciation (45,419 ) (39,120 ) $ 52,388 $ 46,574 |
Accrued Expenses and Other Cu28
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of accrued expenses and current liabilities | Accrued expenses and other current liabilities is comprised of the following: June 30, 2016 2015 (in thousands) Deferred warranty revenue $ 29,836 $ 22,346 Accrued compensation 19,917 20,906 Accrued marketing expense 2,459 1,480 Accrued freight 3,507 3,291 Brazilian pre-acquisition contingencies 2,941 3,676 Other taxes payable 11,044 9,240 Other accrued liabilities 29,271 20,061 $ 98,975 $ 81,000 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
KBZ [Member] | |
Business Acquisition [Line Items] | |
Schedule of Purchase Price Allocation | The purchase price allocation is as follows: September 4, 2015 (in thousands) Receivables, net $ 63,131 Inventory 11,227 Other Current Assets 10,303 Property and equipment, net 677 Goodwill 21,639 Identifiable intangible assets 18,400 Other non-current assets 1,399 $ 126,776 Accounts payable $ 48,271 Accrued expenses and other current liabilities 14,863 Other long-term liabilities 2,167 Consideration transferred, net of cash acquired 61,475 $ 126,776 |
Network1 [Member] | |
Business Acquisition [Line Items] | |
Schedule of Purchase Price Allocated to Goodwill and Intangible Assets | Goodwill Identifiable Intangible Assets (in thousands) Purchase price allocation June 30, 2015 $ 22,536 $ 23,258 Opening balance sheet adjustments 8,496 (76 ) Purchase price allocation June 30, 2016 $ 31,032 $ 23,182 |
Imago [Member] | |
Business Acquisition [Line Items] | |
Schedule of Purchase Price Allocated to Goodwill and Intangible Assets | Goodwill Identifiable Intangible Assets (in thousands) Imago ScanSource $ 18,266 $ 19,606 |
Goodwill and Other Identifiab30
Goodwill and Other Identifiable Intangible Assets (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Goodwill | Changes in the carrying amount of goodwill for the years ended June 30, 2016 and 2015 , by reportable segment, are as follows: Barcode & Security Segment Communications & Services Segment Total (in thousands) Balance at June 30, 2014 $ 16,876 $ 15,466 $ 32,342 Additions — 40,802 40,802 Unrealized gain (loss) on foreign currency translation (1,341 ) (5,294 ) (6,635 ) Balance at June 30, 2015 $ 15,535 $ 50,974 $ 66,509 Additions 21,639 8,496 1 30,135 Unrealized gain (loss) on foreign currency translation (740 ) (3,189 ) (3,929 ) Balance at June 30, 2016 $ 36,434 $ 56,281 $ 92,715 1 The Company finalized the purchase accounting for the Network1 acquisition during the quarter ended December 31, 2015 and subsequently identified an additional correction in the quarter ended March 31, 2016, which resulted in an increased value assumed for goodwill as compared to June 30, 2015. |
Schedule of Identifiable Intangible Assets | The following table shows the Company’s identifiable intangible assets as of June 30, 2016 and 2015 , respectively. June 30, 2016 June 30, 2015 Gross Carrying Amount Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Amortization Net Book Value (in thousands) Amortized intangible assets: Customer relationships $ 70,379 $ 26,668 $ 43,711 $ 59,448 $ 20,573 $ 38,875 Trade names 11,270 4,398 6,872 7,857 1,278 6,579 Non-compete agreements 1,103 777 326 1,113 539 574 Distributor agreements 345 127 218 345 101 244 Total intangibles $ 83,097 $ 31,970 $ 51,127 $ 68,763 $ 22,491 $ 46,272 |
Schedule of Estimated Future Amortization Expense | Estimated future amortization expense is as follows: Amortization Expense (in thousands) Year Ended June 30, 2017 $ 10,266 2018 8,084 2019 6,004 2020 5,387 2021 5,277 Thereafter 16,109 Total $ 51,127 |
Short-Term Borrowings and Lon31
Short-Term Borrowings and Long-Term Debt (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Maturities of Revolving Credit Facility and Long-term Debt | Scheduled maturities of the Company’s revolving credit facility and long-term debt at June 30, 2016 are as follows: Long-Term Debt Revolving Credit Facility (in thousands) Fiscal year: 2017 $ — $ — 2018 — — 2019 329 71,427 2020 333 — 2021 338 — Thereafter 4,429 — Total principal payments $ 5,429 $ 71,427 |
Derivatives and Hedging Activ32
Derivatives and Hedging Activities (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Derivative Contracts and Changes in Underlying Value of the Foreign Currency Exposures | Summarized financial information related to these derivative contracts and changes in the underlying value of the foreign currency exposures are as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Net foreign exchange derivative contract (gain) loss $ (1,951 ) $ (5,364 ) $ 3,640 Net foreign currency transactional and re-measurement (gain) loss 4,522 8,408 (3,024 ) Net foreign currency (gain) loss $ 2,571 $ 3,044 $ 616 |
Derivative Instruments | The Company has the following derivative instruments located on the Consolidated Balance Sheets and Income Statements, utilized for the risk management purposes detailed above: As of June 30, 2016 Fair Value of Derivatives Designated as Hedge Instruments Fair Value of Derivatives Not Designated as Hedge Instruments (in thousands) Derivative assets: (a) Foreign exchange contracts $ — $ 33 Derivative liabilities: (b) Foreign exchange contracts $ — $ 551 (a) All derivative assets are recorded as prepaid expense and other current assets in the Consolidated Balance Sheets. (b) All derivative liabilities are recorded as accrued expenses and other current liabilities in the Consolidated Balance Sheets. |
Fair Value of Financial Instr33
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Short-term Investments and Financial Instruments | The following table summarizes the valuation of the Company's remaining assets and liabilities measured at fair value on a recurring basis as of June 30, 2016 : Total Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 17,893 $ 17,893 $ — $ — Forward foreign currency exchange contracts 33 — 33 — Total assets at fair value $ 17,926 $ 17,893 $ 33 $ — Liabilities: Deferred compensation plan investments, current and non-current portion $ 17,893 $ 17,893 $ — $ — Forward foreign currency exchange contracts 551 — 551 — Liability for contingent consideration, current and non-current 24,652 — — 24,652 Total liabilities at fair value $ 43,096 $ 17,893 $ 551 $ 24,652 The following table presents assets and liabilities measured at fair value on a recurring basis as of June 30, 2015 : Total Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 15,970 $ 15,970 $ — $ — Forward foreign currency exchange contracts 125 — 125 — Cross-currency swap agreements $ 103 $ — $ 103 $ — Total assets at fair value $ 16,198 $ 15,970 $ 228 $ — Liabilities: Deferred compensation plan investments, current and non-current portion $ 15,970 $ 15,970 $ — $ — Forward foreign currency exchange contracts 476 — 476 — Liability for contingent consideration, current and non-current 33,960 — — 33,960 Total liabilities at fair value $ 50,406 $ 15,970 $ 476 $ 33,960 |
Fair Value, Business Acquisition, Liability for Contingent Consideration | The tables below provides a summary of the changes in fair value of the Company’s contingent considerations for the CDC, Imago ScanSource, and Network1 earnouts, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended June 30, 2016 and 2015 : Contingent Consideration for the Year Ended June 30, 2016 Barcode & Security Segment Communications & Services Segment Total (in thousands) Fair value at beginning of period $ 5,109 $ 28,851 $ 33,960 Payments (4,453 ) (4,153 ) (8,606 ) Change in fair value 181 1,113 1,294 Fluctuation due to foreign currency exchange (837 ) (1,159 ) (1,996 ) Fair value at end of period $ — $ 24,652 $ 24,652 Contingent Consideration for the Year Ended June 30, 2015 Barcode & Security Segment Communications & Services Segment Total (in thousands) Fair value at beginning of period $ 11,107 $ — $ 11,107 Issuance of contingent consideration — 32,035 32,035 Payments (5,640 ) — (5,640 ) Change in fair value 1,636 1,031 2,667 Fluctuation due to foreign currency exchange (1,994 ) (4,215 ) (6,209 ) Fair value at end of period $ 5,109 $ 28,851 $ 33,960 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Share-based Compensation [Abstract] | |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award | Total share-based compensation included as a component of selling, general, and administrative expenses in our Consolidated Income Statements was as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Share-based compensation related to: Equity classified stock options $ 1,479 $ 1,480 $ 1,577 Equity classified restricted stock 5,614 5,042 3,671 Total share-based compensation $ 7,093 $ 6,522 $ 5,248 |
Weighted Average Assumptions for the Options Granted During the Following Fiscal Years | The Company used the following weighted-average assumptions for the options granted during the following fiscal years: Fiscal Year Ended June 30, 2016 2015 2014 Expected term 4.02 years 4.02 years 4.00 years Expected volatility 28.70 % 30.06 % 33.70 % Risk-free interest rate 1.47 % 1.22 % 1.07 % Dividend yield 0.00 % 0.00 % 0.00 % Weighted-average fair value per option $ 9.53 $ 10.51 $ 11.91 |
Stock Option Plans | A summary of our stock option plans is presented below: Fiscal Year Ended June 30, 2016 Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Life Aggregate Intrinsic Value Outstanding, beginning of year 1,166,031 $ 35.09 Granted during the period 128,000 38.15 Exercised during the period (194,041 ) 29.04 Canceled, forfeited, or expired during the period (1,825 ) 32.03 Outstanding, end of year 1,098,165 36.52 5.35 $ 2,123,342 Vested and expected to vest at June 30, 2016 1,096,239 36.51 5.34 $ 2,123,244 Exercisable, end of year 819,670 $ 35.35 4.19 $ 2,120,598 |
Unvested Shares | A summary of the status of the Company’s shares subject to unvested options is presented below: Fiscal Year Ended June 30, 2016 Options Weighted Average Exercise Price Weighted Average Grant Date Fair- Value Unvested, beginning of year 286,580 $ 39.98 $ 10.91 Granted 128,000 38.15 9.53 Vested (136,085 ) 38.29 10.93 Canceled or forfeited — — — Unvested, end of year 278,495 $ 39.96 $ 10.27 |
Stock Options Outstanding | The following table summarizes information about stock options outstanding and exercisable as of June 30, 2016 : Options Outstanding Options Exercisable Range of Exercise Prices Shares Outstanding Weighted Average Remaining Contractual Life Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $18.13 - $22.27 5,600 2.43 $ 18.14 5,600 $ 18.14 $22.27 - $26.38 30,000 3.43 24.57 30,000 24.57 $26.38 - $30.49 35,922 6.48 29.59 35,922 29.59 $30.49 - $34.60 296,929 3.38 33.23 296,929 33.23 $34.60 - $38.71 442,765 5.02 36.92 313,940 36.43 $38.71 - $42.82 286,949 8.02 41.77 137,279 42.04 1,098,165 5.35 $ 36.52 819,670 $ 35.35 |
Restricted Stock Outstanding | During the fiscal year ended June 30, 2016 , the Company granted 138,634 shares of restricted stock to employees and non-employee directors, all of which were issued in the form of RSUs or PUs: Fiscal Year Ended June 30, 2016 Shares granted Date granted Grant date fair value Vesting period Employees Certain employees 124,572 December 4, 2015 38.19 Annually over 3 years Certain employees 476 February 12, 2016 36.30 Annually over 3 years Non-Employee Directors (1) Certain Directors 13,500 December 4, 2015 $ 38.19 6 months (1) Under the 2013 Long-Term Incentive Plan, non-employee directors will receive annual awards of restricted stock, as opposed to stock options. The number of shares of restricted stock to be granted will be established from time to time by the Board of Directors. Currently, the number of shares of restricted stock awarded annually to each non-employee director generally will be determined by dividing $100,000 by the equity award value of the common stock on the date of grant, as defined in the 2013 Long-Term Incentive Plan. The equity award value means the value per share based on a 45 -day averaging of the fair market value of the common stock over a specified period of time, or the fair market value of the common stock on a specified date. These awards will generally vest in full on the day that is six months after the date of grant or upon the earlier occurrence of (i) the director’s termination of service as a director by reason of death, disability or retirement, or (ii) a change in control by the Company. The compensation expense associated with these awards will be recognized on a pro-rata basis over this period. A summary of the status of the Company’s outstanding restricted stock is presented below: Fiscal Year Ended June 30, 2016 Shares Weighted-Average Grant Date Fair Value Outstanding, beginning of year 279,196 $ 38.87 Granted during the period 138,634 38.18 Target shares adjustment during the period (1) 366 39.01 Vested during the period (133,068 ) 38.83 Cancelled, forfeited, or expired during the period (10,324 ) 40.65 Outstanding, end of year 274,804 $ 39.06 (1) These target shares granted as RSUs during fiscal year 2015 have service based and performance based vesting conditions. The actual number of shares granted for each of the three tranches, for the period June 1, 2014 through June 30, 2017, is determined after the date of the Company's financial statements. Therefore, the adjustment recognized during fiscal year 2016 represents the variance between the shares assumed to be granted versus at June 30, 2015 the actual shares granted for the first tranche. |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Employer Contributions | Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Matching contributions $ 735 $ 626 $ 553 Discretionary contributions 3,617 5,350 5,207 Total contributions $ 4,352 $ 5,976 $ 5,760 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Expense (Benefit) | Income tax expense (benefit) consists of: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Current: Federal $ 21,855 $ 24,658 $ 25,895 State 1,652 1,639 2,439 Foreign 6,100 4,927 3,826 Total current 29,607 31,224 32,160 Deferred: Federal 3,990 2,165 7,933 State 365 198 725 Foreign (1,571 ) 900 500 Total deferred 2,784 3,263 9,158 Provision for income taxes $ 32,391 $ 34,487 $ 41,318 |
Reconciliation of U.S.Federal Income Tax Expense | A reconciliation of the U.S. Federal income tax expense at a statutory rate of 35% to actual income tax expense, excluding any other taxes related to extraordinary gain is as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) U.S. Federal income tax at statutory rate $ 33,603 $ 34,967 $ 43,088 Increase (decrease) in income taxes due to: State and local income taxes, net of Federal benefit 1,578 1,318 1,974 Tax credits (2,517 ) (1,435 ) (1,935 ) Valuation allowance 541 582 803 Effect of foreign operations, net (1,150 ) (1,665 ) (1,627 ) Stock compensation (62 ) (419 ) (494 ) Capitalized acquisition costs 70 839 — Other 328 300 (491 ) Provision for income taxes $ 32,391 $ 34,487 $ 41,318 |
Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities are presented below: June 30, 2016 2015 (in thousands) Deferred tax assets derived from: Allowance for accounts receivable $ 12,458 $ 9,925 Inventories 4,799 5,235 Nondeductible accrued expenses 3,842 5,838 Net operating loss carryforwards 3,036 2,223 Tax credits 3,316 2,136 Timing of amortization deduction from goodwill 2,660 10,652 Deferred compensation 6,733 6,014 Stock compensation 6,014 5,730 Timing of amortization deduction from intangible assets 1,600 83 Total deferred tax assets 44,458 47,836 Valuation allowance (3,029 ) (2,509 ) Total deferred tax assets, net of allowance 41,429 45,327 Deferred tax liabilities derived from: Timing of depreciation and other deductions from building and equipment (6,827 ) (549 ) Timing of amortization deduction from goodwill (5,370 ) (4,908 ) Timing of amortization deduction from intangible assets (2,974 ) (4,680 ) Total deferred tax liabilities (15,171 ) (10,137 ) Net deferred tax assets $ 26,258 $ 35,190 |
Components of Pretax Earnings | The components of pretax earnings are as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Domestic $ 76,062 $ 79,364 $ 104,685 Foreign 19,948 20,542 18,422 Worldwide pretax earnings $ 96,010 $ 99,906 $ 123,107 |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: June 30, 2016 2015 2014 (in thousands) Beginning Balance $ 1,301 $ 1,153 $ 1,034 Additions based on tax positions related to the current year 326 262 204 Additions for tax positions of prior years 658 — — Reduction for tax positions of prior years (137 ) (114 ) (85 ) Ending Balance $ 2,148 $ 1,301 $ 1,153 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Business Acquisition [Line Items] | |
Lease Expense | Lease expense and future minimum lease payments under operating leases and the single capital lease are as follows: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Lease expense $ 7,394 $ 6,168 $ 5,561 |
Future Minimum Lease Payments | Operating Lease Payments Capital Lease Payments Total Payments (in thousands) Fiscal Year Ended June 30, 2017 $ 6,828 $ 248 $ 7,076 2018 3,670 — 3,670 2019 1,825 — 1,825 2020 1,146 — 1,146 2021 478 — 478 Thereafter 28 — 28 Total future minimum lease payments 13,975 248 14,223 Less: amounts representing interest on capital lease — 2 2 Total future minimum principal lease payments $ 13,975 $ 246 $ 14,221 |
Schedule of capital leased assets | The components of the Company's capital lease as of June 30, 2016 are as follows: Capital Lease Obligations Property & Equipment Accumulated Depreciation Net Book Value Short-Term Long-Term Total (in thousands) IT Infrastructure $ 731 $ 487 $ 244 $ 246 $ — $ 246 |
CDC Brasil S A [Member] | |
Business Acquisition [Line Items] | |
Schedule of pre-acquisitions contingencies and corresponding indemnifications receivables | The table below summarizes the balances and line item presentation of CDC's pre-acquisition contingencies and corresponding indemnification receivables in the Company's consolidated balance sheet: June 30, 2016 June 30, 2015 (in thousands) Assets Prepaid expenses and other assets (current) $ 2,346 $ 3,156 Other assets (noncurrent) $ — $ 69 Liabilities Other current liabilities $ 2,346 $ 3,156 Other long-term liabilities $ — $ 69 |
Network1 [Member] | |
Business Acquisition [Line Items] | |
Schedule of pre-acquisitions contingencies and corresponding indemnifications receivables | The table below summarizes the balances and line item presentation of Network1's pre-acquisition contingencies and corresponding indemnification receivables in the Company's consolidated balance sheet: June 30, 2016 June 30, 2015 (in thousands) Assets Prepaid expenses and other assets (current) $ 595 $ 520 Other assets (noncurrent) $ 9,837 $ 10,769 Liabilities Other current liabilities $ 595 $ 520 Other long-term liabilities $ 9,837 $ 10,769 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Financial Information by Segment | Selected financial information for each business segment is presented below: Fiscal Year Ended June 30, 2016 2015 2014 (in thousands) Sales: Worldwide Barcode & Security $ 2,381,331 $ 2,134,124 $ 2,003,911 Worldwide Communications & Services 1,158,895 1,084,502 909,723 $ 3,540,226 $ 3,218,626 $ 2,913,634 Depreciation and amortization: Worldwide Barcode & Security $ 5,663 $ 3,813 $ 4,243 Worldwide Communications & Services 8,531 6,912 3,132 Corporate 2,960 1,272 — $ 17,154 $ 11,997 $ 7,375 Operating income: Worldwide Barcode & Security $ 53,015 $ 49,045 $ 49,544 Worldwide Communications & Services 44,725 55,650 56,752 Corporate (1) (863 ) (3,254 ) 15,490 $ 96,877 $ 101,441 $ 121,786 Capital expenditures: Worldwide Barcode & Security $ 5,310 $ 733 $ 784 Worldwide Communications & Services 3,911 1,448 316 Corporate 2,860 18,581 10,128 $ 12,081 $ 20,762 $ 11,228 Sales by Geography Category: United States $ 2,655,760 $ 2,391,073 $ 2,225,962 International 920,098 871,862 733,744 Less intercompany sales (35,632 ) (44,309 ) (46,072 ) $ 3,540,226 $ 3,218,626 $ 2,913,634 (1) For the years ended June 30, 2016 and 2015, the amounts shown above includes acquisition costs. For the year ended June 30, 2014, the amount shown above includes a legal recovery, net of attorney fees. June 30, 2016 June 30, 2015 (in thousands) Assets: Worldwide Barcode & Security $ 836,674 $ 740,020 Worldwide Communications & Services 595,781 599,358 Corporate 58,730 137,563 $ 1,491,185 $ 1,476,941 Property and equipment, net by Geography Category: United States $ 46,935 $ 41,159 International 5,453 5,415 $ 52,388 $ 46,574 |
Accumulated Other Comprehensi39
Accumulated Other Comprehensive (Loss) Income (Tables) | 12 Months Ended |
Jun. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Components Of Accumulated Other Comprehensive Income, Net Of Tax | The components of accumulated other comprehensive (loss) income, net of tax, are as follows: Fiscal Years Ended June 30, 2016 2015 2014 (in thousands) Currency translation adjustment $ (72,687 ) $ (64,502 ) $ (16,700 ) Accumulated other comprehensive income (loss) $ (72,687 ) $ (64,502 ) $ (16,700 ) |
Schedule of Other Comprehensive Income (Loss), Tax | The tax effect of amounts in comprehensive income (loss) reflect a tax expense or benefit as follows: Fiscal years ended June 30, 2016 2015 2014 (in thousands) Tax expense (benefit) $ 327 $ 2,382 $ (279 ) |
Business and Summary of Signi40
Business and Summary of Significant Accounting Policies (Narrative) (Details) $ in Thousands | 12 Months Ended | |||
Jun. 30, 2016USD ($)product_linesegment | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2013USD ($) | |
Number of reportable segments | segment | 2 | |||
Cash and cash equivalents | $ 61,400 | $ 121,646 | $ 194,851 | $ 148,164 |
Deferred compensation plan assets | 17,893 | 15,970 | ||
Portion of investment obligation in current liabilities | $ 1,600 | $ 700 | ||
Number of product lines with warranty programs | product_line | 3 | |||
Product warranty term | 30 days | |||
Service revenue as a percent of net sales, maximum | 3.00% | 3.00% | 2.00% | |
Shipping revenue | $ 13,000 | $ 12,200 | $ 12,200 | |
Buildings [Member] | ||||
Property and equipment, estimated useful life (years) | 40 years | |||
Building Improvements [Member] | ||||
Property and equipment, estimated useful life (years) | 15 years | |||
Minimum [Member] | Furniture [Member] | ||||
Property and equipment, estimated useful life (years) | 3 years | |||
Minimum [Member] | Equipment [Member] | ||||
Property and equipment, estimated useful life (years) | 3 years | |||
Minimum [Member] | Software [Member] | ||||
Property and equipment, estimated useful life (years) | 3 years | |||
Minimum [Member] | Customer Relationships [Member] | ||||
Intangible assets, estimated useful life (years) | 5 years | |||
Minimum [Member] | Distribution Rights [Member] | ||||
Intangible assets, estimated useful life (years) | 5 years | |||
Minimum [Member] | Trade Names [Member] | ||||
Intangible assets, estimated useful life (years) | 1 year | |||
Maximum [Member] | Furniture [Member] | ||||
Property and equipment, estimated useful life (years) | 10 years | |||
Maximum [Member] | Equipment [Member] | ||||
Property and equipment, estimated useful life (years) | 10 years | |||
Maximum [Member] | Software [Member] | ||||
Property and equipment, estimated useful life (years) | 10 years | |||
Maximum [Member] | Customer Relationships [Member] | ||||
Intangible assets, estimated useful life (years) | 15 years | |||
Maximum [Member] | Distribution Rights [Member] | ||||
Intangible assets, estimated useful life (years) | 15 years | |||
Maximum [Member] | Trade Names [Member] | ||||
Intangible assets, estimated useful life (years) | 5 years | |||
Customer Concentration Risk [Member] | Maximum [Member] | ||||
Concentration risk percentage | 5.00% | 5.00% | 5.00% | |
Supplier Concentration Risk [Member] | Minimum [Member] | ||||
Concentration risk percentage | 10.00% | 10.00% | 10.00% | |
Non-US [Member] | ||||
Cash and cash equivalents | $ 52,700 | $ 43,400 | ||
Bank Overdrafts [Member] | ||||
Outstanding checks | 78,300 | $ 62,900 | ||
Deferred Tax Asset [Member] | ||||
Deferred income tax reclassified from current assets to non-current assets | $ 20,600 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Earnings Per Share [Abstract] | |||
Net income | $ 63,619 | $ 65,419 | $ 81,789 |
Denominator: Weighted-average shares, basic (in shares) | 26,472,000 | 28,558,000 | 28,337,000 |
Denominator: Dilutive effect of share-based payments (in shares) | 215,000 | 241,000 | 265,000 |
Denominator: Weighted-average shares, diluted (in shares) | 26,687,000 | 28,799,000 | 28,602,000 |
Net income per common share, basic (in dollars per share) | $ 2.40 | $ 2.29 | $ 2.89 |
Net income per common share, diluted (in dollars per share) | $ 2.38 | $ 2.27 | $ 2.86 |
Weighted average shares excluded from the computation of diluted earnings per share (in shares) | 461,090 | 340,697 | 230,706 |
Property and Equipment (Narrati
Property and Equipment (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 7.3 | $ 5.4 | $ 3.5 |
Property and Equipment (Compone
Property and Equipment (Components of Property and Equipment) (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Property, Plant and Equipment [Abstract] | ||
Land | $ 3,009 | $ 3,009 |
Buildings and leasehold improvements | 20,473 | 21,266 |
Computer software and equipment | 46,112 | 44,444 |
Furniture, fixtures and equipment | 23,316 | 16,849 |
Construction in progress | 4,897 | 126 |
Property and equipment, gross | 97,807 | 85,694 |
Less accumulated depreciation | (45,419) | (39,120) |
Property and equipment, net | $ 52,388 | $ 46,574 |
Accrued Expenses and Other Cu44
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Payables and Accruals [Abstract] | ||
Deferred warranty revenue | $ 29,836 | $ 22,346 |
Accrued compensation | 19,917 | 20,906 |
Accrued marketing expense | 2,459 | 1,480 |
Accrued freight | 3,507 | 3,291 |
Brazilian pre-acquisition contingencies | 2,941 | 3,676 |
Other taxes payable | 11,044 | 9,240 |
Other accrued liabilities | 29,271 | 20,061 |
Accrued expensed and other current liabilities | $ 98,975 | $ 81,000 |
Acquisitions (Narrative) (Detai
Acquisitions (Narrative) (Details) $ in Thousands | Sep. 04, 2015USD ($) | Jan. 13, 2015USD ($)payment | Sep. 19, 2014USD ($)payment | Mar. 31, 2016USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) |
Business Acquisition [Line Items] | |||||||
Cash paid for business acquisitions, net of cash acquired | $ 61,475 | $ 59,779 | $ 0 | ||||
Weighted average amortization period | 10 years | 10 years | 11 years | ||||
KBZ [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Initial cash payment | $ 64,600 | ||||||
Cash acquired in acquisition | 3,100 | ||||||
Cash paid for business acquisitions, net of cash acquired | $ 61,475 | ||||||
Weighted average amortization period | 8 years | ||||||
Debt assumed in acquisition | $ 126,776 | ||||||
Network1 [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Initial cash payment | $ 29,100 | ||||||
Cash acquired in acquisition | 4,800 | ||||||
Cash paid for business acquisitions, net of cash acquired | $ 24,300 | ||||||
Weighted average amortization period | 9 years | ||||||
Percentage of company equity acquired | 100.00% | ||||||
Earnout payments, number of installments | payment | 4 | ||||||
Debt assumed in acquisition | $ 35,200 | ||||||
Goodwill, purchase accounting adjustments | $ 7,900 | $ 8,496 | |||||
Imago [Member] | |||||||
Business Acquisition [Line Items] | |||||||
Initial cash payment | $ 37,400 | ||||||
Cash acquired in acquisition | 1,900 | ||||||
Cash paid for business acquisitions, net of cash acquired | $ 35,500 | ||||||
Weighted average amortization period | 9 years | ||||||
Percentage of company equity acquired | 100.00% | ||||||
Earnout payments, number of installments | payment | 2 | ||||||
Deferred tax liability acquired | $ 4,100 |
Acquisitions (Purchase Price Al
Acquisitions (Purchase Price Allocation) (Details) - USD ($) $ in Thousands | Sep. 04, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 92,715 | $ 66,509 | $ 32,342 | |
Other current liabilities | 2,941 | 3,676 | ||
Consideration transferred, net of cash acquired | $ 61,475 | $ 59,779 | $ 0 | |
KBZ [Member] | ||||
Business Acquisition [Line Items] | ||||
Receivables, net | $ 63,131 | |||
Inventory | 11,227 | |||
Other Current Assets | 10,303 | |||
Property and equipment, net | 677 | |||
Goodwill | 21,639 | |||
Identifiable intangible assets | 18,400 | |||
Other non-current assets | 1,399 | |||
Total Assets | 126,776 | |||
Accounts payable | 48,271 | |||
Other current liabilities | 14,863 | |||
Other long-term liabilities | 2,167 | |||
Consideration transferred, net of cash acquired | 61,475 | |||
Debt assumed in acquisition | $ 126,776 |
Acquisitions (Goodwill and Iden
Acquisitions (Goodwill and Identified Intangible Assets) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2016 | Jun. 30, 2016 | Sep. 19, 2014 | Jun. 30, 2014 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 66,509 | $ 32,342 | ||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 66,509 | |||
Goodwill, ending balance | 92,715 | |||
Network1 [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 22,536 | |||
Identifiable Intangible Assets | 23,258 | |||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 22,536 | |||
Opening balance sheet adjustments, goodwill | $ 7,900 | 8,496 | ||
Goodwill, ending balance | 31,032 | |||
Identifiable Intangible Assets, beginning balance | 23,258 | |||
Opening balance sheet adjustments, identifiable intangible assets | (76) | |||
Identifiable Intangible Assets, ending balance | $ 23,182 | |||
Imago [Member] | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 18,266 | |||
Identifiable Intangible Assets | $ 19,606 |
Goodwill and Other Identifiab48
Goodwill and Other Identifiable Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Weighted average amortization period | 10 years | 10 years | 11 years |
Amortization expense | $ 9.8 | $ 6.6 | $ 3.9 |
Goodwill and Other Identifiab49
Goodwill and Other Identifiable Intangible Assets (Changes in the Carrying Amount of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 66,509 | $ 32,342 |
Additions | 30,135 | 40,802 |
Unrealized gain (loss) on foreign currency translation | (3,929) | (6,635) |
Goodwill, ending balance | 92,715 | 66,509 |
Barcode and Security Products [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 15,535 | 16,876 |
Additions | 21,639 | 0 |
Unrealized gain (loss) on foreign currency translation | (740) | (1,341) |
Goodwill, ending balance | 36,434 | 15,535 |
Communications and Services Products [Member] | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 50,974 | 15,466 |
Additions | 8,496 | 40,802 |
Unrealized gain (loss) on foreign currency translation | (3,189) | (5,294) |
Goodwill, ending balance | $ 56,281 | $ 50,974 |
Goodwill and Other Identifiab50
Goodwill and Other Identifiable Intangible Assets (Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, gross carrying amount | $ 83,097 | $ 68,763 |
Amortized intangible assets, accumulated amortization | 31,970 | 22,491 |
Amortized intangible assets, net book value | 51,127 | 46,272 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, gross carrying amount | 70,379 | 59,448 |
Amortized intangible assets, accumulated amortization | 26,668 | 20,573 |
Amortized intangible assets, net book value | 43,711 | 38,875 |
Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, gross carrying amount | 11,270 | 7,857 |
Amortized intangible assets, accumulated amortization | 4,398 | 1,278 |
Amortized intangible assets, net book value | 6,872 | 6,579 |
Non-compete Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, gross carrying amount | 1,103 | 1,113 |
Amortized intangible assets, accumulated amortization | 777 | 539 |
Amortized intangible assets, net book value | 326 | 574 |
Distributor Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized intangible assets, gross carrying amount | 345 | 345 |
Amortized intangible assets, accumulated amortization | 127 | 101 |
Amortized intangible assets, net book value | $ 218 | $ 244 |
Goodwill and Other Identifiab51
Goodwill and Other Identifiable Intangible Assets (Estimated Future Amortization Expense) (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,017 | $ 10,266 |
2,018 | 8,084 |
2,019 | 6,004 |
2,020 | 5,387 |
2,021 | 5,277 |
Thereafter | 16,109 |
Total | $ 51,127 |
Short-Term Borrowings and Lon52
Short-Term Borrowings and Long-Term Debt (Narrative) (Details) | 12 Months Ended | |||||
Jun. 30, 2016GBP (£)quarter | Jun. 30, 2016USD ($)quarter | Jun. 30, 2015USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2016EUR (€) | Jun. 30, 2015EUR (€) | |
Revolving credit facility, amount outstanding | $ 0 | $ 71,427,000 | ||||
Debt issuance costs | 700,000 | |||||
Industrial Development Revenue Bond [Member] | ||||||
Percentage spread points on variable rate debt instrument | 0.85% | 0.85% | ||||
Maturity date of debt instrument | Sep. 1, 2032 | Sep. 1, 2032 | ||||
Maximum time period of interest (in years) | 10 years | 10 years | ||||
Debt instrument, exercisable option limitation, period | 180 days | 180 days | ||||
Debt instrument, anniversary, options exercisable, period | 5 years | 5 years | ||||
Debt instrument, redemption price, percentage | 100.00% | 100.00% | ||||
Long-term debt | $ 5,400,000 | $ 5,400,000 | ||||
Variable interest rate of debt | 1.32% | 1.03% | 1.32% | 1.32% | 1.03% | |
Multi-Currency Invoice Discounting Credit Facility [Member] | ||||||
Line of credit facility, maximum borrowing capacity, percentage | 85.00% | 85.00% | 85.00% | |||
Borrowing capacity under credit facility | £ 4,150,000 | $ 100,000 | € 250,000 | |||
Percentage spread points on variable rate debt instrument | 1.85% | 1.85% | ||||
Commitment fee amount | £ | £ 100,000 | |||||
Multi-Currency Revolving Credit Facility [Member] | ||||||
Borrowing capacity under credit facility | $ 300,000,000 | |||||
Maturity of credit facility | Nov. 6, 2018 | Nov. 6, 2018 | ||||
Debt instrument, covenant requirement, leverage ratio, EBITDA, number of quarters in measurement period | quarter | 4 | 4 | ||||
Line of credit facility, unused capacity, commitment fee percentage | 0.175% | 0.175% | ||||
Percentage of capital stock or other equity interest pledged per credit agreement | 65.00% | 65.00% | 65.00% | |||
Revolving credit facility, amount outstanding | $ 0 | $ 71,400,000 | ||||
Average daily balance on revolving credit facility | $ 86,600,000 | 1,600,000 | ||||
Amount available for additional borrowings | 300,000,000 | 228,200,000 | ||||
Letters of credit outstanding | € | € 400,000 | € 0 | ||||
Multi-Currency Revolving Credit Facility [Member] | Minimum [Member] | ||||||
Line of credit facility, unused capacity, commitment fee percentage | 0.175% | 0.175% | ||||
Multi-Currency Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Line of credit facility, unused capacity, commitment fee percentage | 0.40% | 0.40% | ||||
Letter of Credit [Member] | ||||||
Borrowing capacity under credit facility | 50,000,000 | |||||
Multi-Currency Revolving Credit Facility, Accordion Feature [Member] | ||||||
Borrowing capacity under credit facility | 150,000,000 | |||||
Multi-Currency Revolving Credit Facility, Combined with Accordion Feature [Member] | ||||||
Borrowing capacity under credit facility | $ 450,000,000 | |||||
London Interbank Offered Rate (LIBOR) [Member] | Multi-Currency Revolving Credit Facility [Member] | ||||||
Percentage spread points on variable rate debt instrument | 1.00% | 1.00% | ||||
London Interbank Offered Rate (LIBOR) [Member] | Multi-Currency Revolving Credit Facility [Member] | Minimum [Member] | ||||||
Percentage spread points on variable rate debt instrument | 1.00% | 1.00% | ||||
London Interbank Offered Rate (LIBOR) [Member] | Multi-Currency Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Percentage spread points on variable rate debt instrument | 2.25% | 2.25% | ||||
Alternate Base Rate Loans [Member] | Multi-Currency Revolving Credit Facility [Member] | ||||||
Percentage spread points on variable rate debt instrument | 0.00% | 0.00% | ||||
Alternate Base Rate Loans [Member] | Multi-Currency Revolving Credit Facility [Member] | Minimum [Member] | ||||||
Percentage spread points on variable rate debt instrument | 0.00% | 0.00% | ||||
Alternate Base Rate Loans [Member] | Multi-Currency Revolving Credit Facility [Member] | Maximum [Member] | ||||||
Percentage spread points on variable rate debt instrument | 1.25% | 1.25% | ||||
Network1 Term Loan, Banco Safra [Member] | ||||||
Maturity date of debt instrument | Sep. 21, 2015 | Sep. 21, 2015 | ||||
Interest rate percentage | 3.60% | 3.60% | 3.60% | |||
Network1 Term Loan, Banco do Bradesco [Member] | ||||||
Maturity date of debt instrument | May 9, 2016 | May 9, 2016 | ||||
Interest rate percentage | 11.48% | 11.48% | 11.48% | |||
Long-term debt, current maturities | 1,800,000 | $ 0 | ||||
Network1 Term Loan, Banco do Brasil [Member] | ||||||
Maturity date of debt instrument | Oct. 28, 2017 | Oct. 28, 2017 | ||||
Long-term debt | 900,000 | $ 0 | ||||
Interest rate percentage | 12.08% | 12.08% | 12.08% | |||
Long-term debt, current maturities | 400,000 | |||||
Currency Swap [Member] | Network1 Term Loan, Banco Safra [Member] | CDI rate [Member] | ||||||
Percentage spread points on variable rate debt instrument | 2.75% | 2.75% | ||||
Variable interest rate of debt | 13.60% | 13.60% | 13.60% | |||
Network1 [Member] | Network1 Term Loan, Banco Safra [Member] | ||||||
Long-term debt, current maturities | $ 700,000 | $ 0 |
Short-Term Borrowings and Lon53
Short-Term Borrowings and Long-Term Debt (Maturities of Revolving Credit Facility and Long-term Debt) (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Industrial Development Revenue Bond [Member] | |
Debt Instrument [Line Items] | |
2,017 | $ 0 |
2,018 | 0 |
2,019 | 329 |
2,020 | 333 |
2,021 | 338 |
Thereafter | 4,429 |
Total principal payments | 5,429 |
Multi-Currency Revolving Credit Facility [Member] | |
Debt Instrument [Line Items] | |
2,017 | 0 |
2,018 | 0 |
2,019 | 71,427 |
2,020 | 0 |
2,021 | 0 |
Thereafter | 0 |
Total principal payments | $ 71,427 |
Derivatives and Hedging Activ54
Derivatives and Hedging Activities (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Interest expense | $ 2,124,000 | $ 1,797,000 | $ 731,000 |
Foreign Exchange Contract [Member] | |||
Notional amount of foreign currency contracts outstanding | $ 46,200,000 | 80,600,000 | |
Network1 [Member] | Currency Swap [Member] | |||
Interest expense | $ 500,000 |
Derivatives and Hedging Activ55
Derivatives and Hedging Activities (Derivative Contracts and Changes in Underlying Value of the Foreign Currency Exposures) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |||
Net foreign exchange derivative contract (gain) loss | $ (1,951) | $ (5,364) | $ 3,640 |
Net foreign currency transactional and re-measurement (gain) loss | 4,522 | 8,408 | (3,024) |
Net foreign currency (gain) loss | $ 2,571 | $ 3,044 | $ 616 |
Derivatives and Hedging Activ56
Derivatives and Hedging Activities (Derivative Instruments) (Details) - Foreign Exchange Contract [Member] $ in Thousands | Jun. 30, 2016USD ($) |
Designated as Hedge Instruments [Member] | |
Derivative assets: foreign exchange contracts | $ 0 |
Derivative liabilities: foreign exchange contracts | 0 |
Not Designated as Hedge Instruments [Member] | |
Derivative assets: foreign exchange contracts | 33 |
Derivative liabilities: foreign exchange contracts | $ 551 |
Fair Value of Financial Instr57
Fair Value of Financial Instruments (Short-term Investments and Financial Instruments at Fair Value) (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Assets: Deferred compensation plan investments, current and non-current portion | $ 17,893 | $ 15,970 |
Assets: Forward foreign currency exchange contracts | 33 | 125 |
Assets: Cross-currency swap agreements | 103 | |
Total asset at fair value | 17,926 | 16,198 |
Liabilities: Deferred compensation plan investments, current and non-current portion | 17,893 | 15,970 |
Liabilities: Forward foreign currency exchange contracts | 551 | 476 |
Liability for contingent consideration, current and non-current | 24,652 | 33,960 |
Total liabilities at fair value | 43,096 | 50,406 |
Quoted Prices in Active Markets (Level 1) [Member] | ||
Assets: Deferred compensation plan investments, current and non-current portion | 17,893 | 15,970 |
Assets: Forward foreign currency exchange contracts | 0 | 0 |
Assets: Cross-currency swap agreements | 0 | |
Total asset at fair value | 17,893 | 15,970 |
Liabilities: Deferred compensation plan investments, current and non-current portion | 17,893 | 15,970 |
Liabilities: Forward foreign currency exchange contracts | 0 | 0 |
Liability for contingent consideration, current and non-current | 0 | 0 |
Total liabilities at fair value | 17,893 | 15,970 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets: Deferred compensation plan investments, current and non-current portion | 0 | 0 |
Assets: Forward foreign currency exchange contracts | 33 | 125 |
Assets: Cross-currency swap agreements | 103 | |
Total asset at fair value | 33 | 228 |
Liabilities: Deferred compensation plan investments, current and non-current portion | 0 | 0 |
Liabilities: Forward foreign currency exchange contracts | 551 | 476 |
Liability for contingent consideration, current and non-current | 0 | 0 |
Total liabilities at fair value | 551 | 476 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Assets: Deferred compensation plan investments, current and non-current portion | 0 | 0 |
Assets: Forward foreign currency exchange contracts | 0 | 0 |
Assets: Cross-currency swap agreements | 0 | |
Total asset at fair value | 0 | 0 |
Liabilities: Deferred compensation plan investments, current and non-current portion | 0 | 0 |
Liabilities: Forward foreign currency exchange contracts | 0 | 0 |
Liability for contingent consideration, current and non-current | 24,652 | 33,960 |
Total liabilities at fair value | $ 24,652 | $ 33,960 |
Fair Value of Financial Instr58
Fair Value of Financial Instruments (Fair Value, Business Acquisition, Liability for Contingent Consideration) (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Current portion of contingent consideration | $ 11,594,000 | $ 9,391,000 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | 33,960,000 | 11,107,000 |
Issuance of contingent consideration | 32,035,000 | |
Payments | (8,606,000) | (5,640,000) |
Change in fair value | 1,294,000 | 2,667,000 |
Fluctuation due to foreign currency exchange | (1,996,000) | (6,209,000) |
Fair value at end of period | 24,652,000 | 33,960,000 |
Barcode and Security Products [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | 5,109,000 | 11,107,000 |
Issuance of contingent consideration | 0 | |
Payments | (4,453,000) | (5,640,000) |
Change in fair value | 181,000 | 1,636,000 |
Fluctuation due to foreign currency exchange | (837,000) | (1,994,000) |
Fair value at end of period | 0 | 5,109,000 |
Communications and Services Products [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | 28,851,000 | 0 |
Issuance of contingent consideration | 32,035,000 | |
Payments | (4,153,000) | 0 |
Change in fair value | 1,113,000 | 1,031,000 |
Fluctuation due to foreign currency exchange | (1,159,000) | (4,215,000) |
Fair value at end of period | 24,652,000 | 28,851,000 |
CDC Brasil S A [Member] | Barcode and Security Products [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | 5,100,000 | |
Change in fair value | (200,000) | |
Fair value at end of period | 5,100,000 | |
Imago [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Undiscounted contingent consideration payments, minimum | 2,900,000 | |
Undiscounted contingent consideration payments, maximum | 2,969,000 | |
Imago [Member] | Communications and Services Products [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | 5,400,000 | |
Change in fair value | (900,000) | |
Fair value at end of period | 2,900,000 | 5,400,000 |
Current portion of contingent consideration | 2,600,000 | |
Network1 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Undiscounted contingent consideration payments, maximum | 26,046,000 | |
Network1 [Member] | Communications and Services Products [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value at beginning of period | 23,500,000 | |
Change in fair value | (200,000) | |
Fair value at end of period | 21,800,000 | 23,500,000 |
Current portion of contingent consideration | $ 8,700,000 | $ 1,700,000 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) | 12 Months Ended | ||
Jun. 30, 2016USD ($)trancheshares | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | |
Options granted during period (in shares) | 128,000 | ||
Total aggregate intrinsic value of options exercised | $ | $ 1,300,000 | $ 600,000 | $ 5,400,000 |
Fair value of options vested during period | $ | $ 1,500,000 | $ 1,600,000 | $ 1,600,000 |
Stock Options [Member] | |||
Options granted during period (in shares) | 128,000 | ||
Vesting period (years) | 3 years | ||
Contractual life (years) | 10 years | ||
Exercise price percentage of fair market value at grant date | 100.00% | ||
Unrecognized compensation cost | $ | $ 2,000,000 | ||
Weighted-average period of recognition of unrecognized compensation cost (years) | 1 year 1 month 6 days | ||
Restricted Stock [Member] | |||
Unrecognized compensation cost | $ | $ 7,600,000 | ||
Weighted-average period of recognition of unrecognized compensation cost (years) | 1 year 1 month | ||
Shares granted (in shares) | 138,634 | ||
Number of tranches | tranche | 3 | ||
Shares withheld for income taxes for share based compensation | 42,379 | ||
2013 Long-Term Incentive Plan [Member] | |||
Shares available for future grant | 2,234,445 | ||
Non-Employee Directors, Certain Directors [Member] | Restricted Stock [Member] | |||
Vesting period (years) | 6 months | ||
Shares granted (in shares) | 13,500 | ||
Amount to be divided by fair market value of common stock | $ | $ 100,000 | ||
Number of days to calculate average value per share | 45 days |
Share-Based Compensation (Sched
Share-Based Compensation (Schedule of Share-Based Compensation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Share-based Compensation [Abstract] | |||
Equity classified stock options | $ 1,479 | $ 1,480 | $ 1,577 |
Equity classified restricted stock | 5,614 | 5,042 | 3,671 |
Total share-based compensation | $ 7,093 | $ 6,522 | $ 5,248 |
Share-Based Compensation (Weigh
Share-Based Compensation (Weighted Average Assumptions for Options Granted) (Details) - $ / shares | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Share-based Compensation [Abstract] | |||
Expected term (years) | 4 years 6 days | 4 years 6 days | 4 years |
Expected volatility | 28.70% | 30.06% | 33.70% |
Risk-free interest rate | 1.47% | 1.22% | 1.07% |
Dividend yield | 0.00% | 0.00% | 0.00% |
Granted, weighted-average grant date fair value (in dollars per share) | $ 9.53 | $ 10.51 | $ 11.91 |
Share-Based Compensation (Stock
Share-Based Compensation (Stock Option Plans) (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Outstanding, beginning of year (in shares) | 1,166,031 | ||
Options granted during period (in shares) | 128,000 | ||
Exercised during the period (in shares) | (194,041) | ||
Canceled, forfeited or expired during the period (in shares) | (1,825) | ||
Outstanding, end of year (in shares) | 1,098,165 | 1,166,031 | |
Vested and expected to vest at June 30, 2015 (in shares) | 1,096,239 | ||
Exercisable, end of year (in shares) | 819,670 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||
Outstanding, beginning of year, Weighted-Average Exercise Price (in dollars per share) | $ 35.09 | ||
Granted during the period, Weighted-Average Exercise Price (in dollars per share) | 38.15 | ||
Exercised during the period, Weighted-Average Exercise Price (in dollars per share) | 29.04 | ||
Canceled, forfeited, or expired during the period, Weighted-Average Exercise Price (in dollars per share) | 32.03 | ||
Outstanding, end of year, Weighted-Average Exercise Price (in dollars per share) | 36.52 | $ 35.09 | |
Vested and expected to vest, Weighted-Average Exercise Price (in dollars per share) | 36.51 | ||
Exercisable, end of year, Weighted-Average Exercise Price (in dollars per share) | $ 35.35 | ||
Outstanding, end of year, Weighted-Average Remaining Contractual Life (years) | 5 years 4 months 7 days | ||
Vested and expected to vest, Weighted-Average Remaining Contractual Life (years) | 5 years 4 months 4 days | ||
Exercisable, end of Year, Weighted-Average Remaining Contractual Life (years) | 4 years 2 months 10 days | ||
Outstanding, Aggregate Intrinsic Value | $ 2,123,342 | ||
Vested and expected to vest, Aggregate Intrinsic Value | 2,123,244 | ||
Exercisable, end of Year, Aggregate Intrinsic Value | $ 2,120,598 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Granted, weighted-average grant date fair value (in dollars per share) | $ 9.53 | 10.51 | $ 11.91 |
Unvested Shares [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Options granted during period (in shares) | 128,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||
Outstanding, beginning of year, Weighted-Average Exercise Price (in dollars per share) | $ 39.98 | ||
Granted during the period, Weighted-Average Exercise Price (in dollars per share) | 38.15 | ||
Exercised during the period, Weighted-Average Exercise Price (in dollars per share) | 38.29 | ||
Canceled, forfeited, or expired during the period, Weighted-Average Exercise Price (in dollars per share) | 0 | ||
Outstanding, end of year, Weighted-Average Exercise Price (in dollars per share) | $ 39.96 | $ 39.98 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | |||
Nonvested, beginning of year (in shares) | 286,580 | ||
Vested during period (in shares) | (136,085) | ||
Canceled or forfeited during period (in shares) | 0 | ||
Nonvested, end of year (in shares) | 278,495 | 286,580 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Unvested, beginning of year, weighted-average grant date fair value (in dollars per share) | $ 10.91 | ||
Granted, weighted-average grant date fair value (in dollars per share) | 9.53 | ||
Vested during period, weighted-average grant date fair value (in dollars per share) | 10.93 | ||
Canceled or forfeited during period, weighted-average grant date fair value (in dollars per share) | 0 | ||
Unvested, end of period, weighted-average grant date fair value (in dollars per share) | $ 10.27 | $ 10.91 |
Share-Based Compensation (Sto63
Share-Based Compensation (Stock Options Outstanding) (Details) | 12 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Options outstanding, shares outstanding (in shares) | shares | 1,098,165 |
Options outstanding, weighted average remaining contractual life (in years) | 5 years 4 months 5 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 36.52 |
Options exercisable, shares exercisable (in shares) | shares | 819,670 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 35.35 |
Range One [Member] | |
Options outstanding, shares outstanding (in shares) | shares | 5,600 |
Options outstanding, weighted average remaining contractual life (in years) | 2 years 5 months 5 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 18.14 |
Options exercisable, shares exercisable (in shares) | shares | 5,600 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 18.14 |
Range of exercise prices, lower limit (in dollars per share) | 18.13 |
Range of exercise prices, upper limit (in dollars per share) | $ 22.27 |
Range Two [Member] | |
Options outstanding, shares outstanding (in shares) | shares | 30,000 |
Options outstanding, weighted average remaining contractual life (in years) | 3 years 5 months 5 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 24.57 |
Options exercisable, shares exercisable (in shares) | shares | 30,000 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 24.57 |
Range of exercise prices, lower limit (in dollars per share) | 22.27 |
Range of exercise prices, upper limit (in dollars per share) | $ 26.38 |
Range Three [Member] | |
Options outstanding, shares outstanding (in shares) | shares | 35,922 |
Options outstanding, weighted average remaining contractual life (in years) | 6 years 5 months 22 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 29.59 |
Options exercisable, shares exercisable (in shares) | shares | 35,922 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 29.59 |
Range of exercise prices, lower limit (in dollars per share) | 26.38 |
Range of exercise prices, upper limit (in dollars per share) | $ 30.49 |
Range Four [Member] | |
Options outstanding, shares outstanding (in shares) | shares | 296,929 |
Options outstanding, weighted average remaining contractual life (in years) | 3 years 4 months 18 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 33.23 |
Options exercisable, shares exercisable (in shares) | shares | 296,929 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 33.23 |
Range of exercise prices, lower limit (in dollars per share) | 30.49 |
Range of exercise prices, upper limit (in dollars per share) | $ 34.60 |
Range Five [Member] | |
Options outstanding, shares outstanding (in shares) | shares | 442,765 |
Options outstanding, weighted average remaining contractual life (in years) | 5 years 8 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 36.92 |
Options exercisable, shares exercisable (in shares) | shares | 313,940 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 36.43 |
Range of exercise prices, lower limit (in dollars per share) | 34.60 |
Range of exercise prices, upper limit (in dollars per share) | $ 38.71 |
Range Six [Member] | |
Options outstanding, shares outstanding (in shares) | shares | 286,949 |
Options outstanding, weighted average remaining contractual life (in years) | 8 years 9 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 41.77 |
Options exercisable, shares exercisable (in shares) | shares | 137,279 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 42.04 |
Range of exercise prices, lower limit (in dollars per share) | 38.71 |
Range of exercise prices, upper limit (in dollars per share) | $ 42.82 |
Share-Based Compensation (Restr
Share-Based Compensation (Restricted Stock Granted) (Details) - Restricted Stock [Member] | 12 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Shares granted (in shares) | shares | 138,634 |
Grant date fair value (in dollars per share) | $ / shares | $ 38.18 |
Certain Employees [Member] | |
Shares granted (in shares) | shares | 124,572 |
Date granted | Dec. 4, 2015 |
Grant date fair value (in dollars per share) | $ / shares | $ 38.19 |
Vesting period | 3 years |
Certain Employees 2 [Member] | |
Shares granted (in shares) | shares | 476 |
Date granted | Feb. 12, 2016 |
Grant date fair value (in dollars per share) | $ / shares | $ 36.30 |
Vesting period | 3 years |
Non-Employee Directors, Certain Directors [Member] | |
Shares granted (in shares) | shares | 13,500 |
Date granted | Dec. 4, 2015 |
Grant date fair value (in dollars per share) | $ / shares | $ 38.19 |
Vesting period | 6 months |
Share-Based Compensation (Res65
Share-Based Compensation (Restricted Stock Outstanding) (Details) - Restricted Stock [Member] | 12 Months Ended |
Jun. 30, 2016$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Unvested, beginning of year, restricted stock (in shares) | shares | 279,196 |
Shares granted (in shares) | shares | 138,634 |
Target shares adjustment during the period (in shares) | shares | 366 |
Vested during period (in shares) | shares | (133,068) |
Canceled, forfeited, or expired during the period (in shares) | shares | (10,324) |
Unvested, end of year, restricted stock (in shares) | shares | 274,804 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Outstanding, beginning of year, Weighted Average Grant Date Fair-Value (in dollars per share) | $ / shares | $ 38.87 |
Grant date fair value (in dollars per share) | $ / shares | 38.18 |
Target shares adjustment during the period, Weighted Average Grant Date Fair Value (in dollars per share) | $ / shares | 39.01 |
Vested, Weighted Average Grant Date Fair-Value (in dollars per share) | $ / shares | 38.83 |
Canceled, forfeited or expired, Weighted Average Grant Date Fair-Value (in dollars per share) | $ / shares | 40.65 |
Outstanding, end of year, Weighted Average Grant Date Fair-Value (in dollars per share) | $ / shares | $ 39.06 |
Employee Benefit Plans (Narrati
Employee Benefit Plans (Narrative) (Details) | 12 Months Ended |
Jun. 30, 2016USD ($) | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Employer matching contribution, percent of participant's contribution | 50.00% |
Employer contribution per participant | $ 800 |
Defined benefit plan, employer contributions, vesting period (in years) | 5 years |
Deferred compensation plan, employer contributions, vesting period (in years) | 5 years |
Employee Benefit Plans (Employe
Employee Benefit Plans (Employer Contributions) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Employer contributions | $ 4,352 | $ 5,976 | $ 5,760 |
Matching Contributions [Member] | |||
Employer contributions | 735 | 626 | 553 |
Discretionary Contributions [Member] | |||
Employer contributions | $ 3,617 | $ 5,350 | $ 5,207 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Statutory rate percentage of federal income tax expense | 35.00% | |||
Valuation allowance, amount | $ 3,029 | $ 2,509 | ||
Income (loss) before income taxes | 96,010 | 99,906 | $ 123,107 | |
Gross unrecognized tax benefits | 2,148 | 1,301 | 1,153 | $ 1,034 |
Unrecognized tax benefits that would impact effective tax rate if recognized | 1,300 | |||
Unrecognized tax benefits, period increase | 500 | |||
Income tax penalties and interest accrued | 1,200 | $ 1,200 | $ 1,100 | |
State and Local [Member] | ||||
Operating loss carry forwards | 1,400 | |||
Tax credit carry forwards | 1,300 | |||
Operating loss carry forwards, valuation allowance | 100 | |||
Withholding Tax Credits [Member] | ||||
Tax credit carry forwards | 2,400 | |||
Valuation allowance, amount | 2,400 | |||
Notional Interest Deduction [Member] | ||||
Valuation allowance, amount | 300 | |||
Foreign [Member] | ||||
Operating loss carry forwards | 9,000 | |||
Tax credit carry forwards | 100 | |||
Operating loss carry forwards, valuation allowance | 200 | |||
Undistributed earnings of foreign subsidiaries | 108,000 | |||
Undistributed earnings of foreign subsidiaries, tax effect | $ 19,200 | |||
Minimum [Member] | ||||
Open tax year | 2,011 | |||
ScanSource Europe SPRL [Member] | ||||
Income (loss) before income taxes | $ (1,200) |
Income Taxes (Income Tax Expens
Income Taxes (Income Tax Expense (Benefit)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | |||
Federal, current | $ 21,855 | $ 24,658 | $ 25,895 |
State, current | 1,652 | 1,639 | 2,439 |
Foreign, current | 6,100 | 4,927 | 3,826 |
Total current | 29,607 | 31,224 | 32,160 |
Federal, deferred | 3,990 | 2,165 | 7,933 |
State, deferred | 365 | 198 | 725 |
Foreign, deferred | (1,571) | 900 | 500 |
Total deferred | 2,784 | 3,263 | 9,158 |
Provision for income taxes | $ 32,391 | $ 34,487 | $ 41,318 |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of U.S.Federal Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | |||
U.S. Federal income tax at statutory rate | $ 33,603 | $ 34,967 | $ 43,088 |
State and local income taxes, net of Federal benefit | 1,578 | 1,318 | 1,974 |
Tax credits | (2,517) | (1,435) | (1,935) |
Valuation allowance | 541 | 582 | 803 |
Effect of foreign operations, net | (1,150) | (1,665) | (1,627) |
Stock compensation | (62) | (419) | (494) |
Capitalized acquisition costs | 70 | 839 | 0 |
Other | 328 | 300 | (491) |
Provision for income taxes | $ 32,391 | $ 34,487 | $ 41,318 |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2016 | Jun. 30, 2015 |
Income Tax Disclosure [Abstract] | ||
Allowance for accounts receivable | $ 12,458 | $ 9,925 |
Inventories | 4,799 | 5,235 |
Nondeductible accrued expenses | 3,842 | 5,838 |
Net operating loss carryforwards | 3,036 | 2,223 |
Tax credits | 3,316 | 2,136 |
Timing of amortization deduction from goodwill | 2,660 | 10,652 |
Deferred compensation | 6,733 | 6,014 |
Stock compensation | 6,014 | 5,730 |
Timing of amortization deduction from intangible assets | 1,600 | 83 |
Total deferred tax assets | 44,458 | 47,836 |
Valuation allowance | (3,029) | (2,509) |
Total deferred tax assets | 41,429 | 45,327 |
Timing of depreciation and other deductions from building and equipment | (6,827) | (549) |
Timing of amortization deduction from goodwill | (5,370) | (4,908) |
Timing of amortization deduction from intangible assets | (2,974) | (4,680) |
Total deferred tax liabilities | (15,171) | (10,137) |
Net deferred tax assets | $ 26,258 | $ 35,190 |
Income Taxes (Components of Pre
Income Taxes (Components of Pretax Earnings) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 76,062 | $ 79,364 | $ 104,685 |
Foreign | 19,948 | 20,542 | 18,422 |
Income before income taxes | $ 96,010 | $ 99,906 | $ 123,107 |
Income Taxes (Reconciliation 73
Income Taxes (Reconciliation of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning Balance | $ 1,301 | $ 1,153 | $ 1,034 |
Additions based on tax positions related to the current year | 326 | 262 | 204 |
Additions for tax positions of prior years | 658 | 0 | 0 |
Reduction for tax positions of prior years | (137) | (114) | (85) |
Ending Balance | $ 2,148 | $ 1,301 | $ 1,153 |
Commitments and Contingencies74
Commitments and Contingencies (Narrative) (Details) ft² in Thousands, $ in Thousands | Jun. 03, 2014 | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($)vendor | Jun. 30, 2015USD ($)vendor | Jun. 30, 2014USD ($)vendor | Apr. 27, 2007ft² |
Term of lease (in months) | 3 years | |||||
Minimum lease payments | $ 731 | |||||
Capital expenditures | 12,081 | $ 20,762 | $ 11,228 | |||
Other current liabilities | $ 2,941 | $ 3,676 | ||||
Minimum [Member] | ||||||
Termination period under terms of distribution agreement (days) | 30 days | |||||
Maximum [Member] | ||||||
Termination period under terms of distribution agreement (days) | 120 days | |||||
Current Square Footage [Member] | ||||||
Area leased under lease agreement (in square feet) | ft² | 593 | |||||
Supplier Concentration Risk [Member] | Sales [Member] | ||||||
Concentration risk, supplier | vendor | 10 | 10 | 10 | |||
Microsoft Dynamics AX ERP Project [Member] | ||||||
Proceeds from legal settlement | $ 15,000 | |||||
Contingency legal fee | 1,500 | |||||
Microsoft Dynamics AX ERP Project [Member] | Avanade [Member] | ||||||
Accrued liabilities | $ 2,000 | |||||
Network1 [Member] | ||||||
Cash held in escrow | $ 4,700 | $ 3,200 | ||||
Undiscounted pre-acquisition contingencies, maximum | 31,000 | |||||
Undiscounted pre-acquisition contingencies, minimum | 9,900 | |||||
Prepaid expenses and other assets (current) | 595 | 520 | ||||
Other assets (noncurrent) | 9,837 | 10,769 | ||||
Other current liabilities | 595 | 520 | ||||
Other long-term liabilities | 9,837 | 10,769 | ||||
CDC Brasil S A [Member] | ||||||
Escrow deposit disbursements to seller | 4,100 | |||||
Cash held in escrow | 3,500 | 8,400 | ||||
Undiscounted pre-acquisition contingencies, maximum | 3,500 | |||||
Prepaid expenses and other assets (current) | 2,346 | 3,156 | ||||
Other assets (noncurrent) | 0 | 69 | ||||
Other current liabilities | 2,346 | 3,156 | ||||
Other long-term liabilities | $ 0 | $ 69 | ||||
Scenario, Forecast [Member] | Minimum [Member] | ||||||
Capital expenditures | $ 3,000 | |||||
Scenario, Forecast [Member] | Maximum [Member] | ||||||
Capital expenditures | 8,000 | |||||
Enterprise Resource Planning, SAP [Member] | Scenario, Forecast [Member] | ||||||
Capital expenditures | $ 1,500 |
Commitments and Contingencies75
Commitments and Contingencies (Lease Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating and Capital Leases, Rent Expense, Net | $ 7,394 | $ 6,168 | $ 5,561 |
Commitments and Contingencies76
Commitments and Contingencies (Future Minimum Lease Payments) (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,017 | $ 6,828 |
2,018 | 3,670 |
2,019 | 1,825 |
2,020 | 1,146 |
2,021 | 478 |
Thereafter | 28 |
Total future minimum lease payments | 13,975 |
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,017 | 248 |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
Thereafter | 0 |
Total future minimum lease payments | 248 |
Less: amounts representing interest on capital lease | 2 |
Total future minimum principal lease payments | 246 |
Operating and Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,017 | 7,076 |
2,018 | 3,670 |
2,019 | 1,825 |
2,020 | 1,146 |
2,021 | 478 |
Thereafter | 28 |
Total future minimum lease payments | 14,223 |
Total future minimum principal lease payments | $ 14,221 |
Commitments and Contingencies C
Commitments and Contingencies Capital Lease Components (Details) $ in Thousands | Jun. 30, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Property & Equipment | $ 731 |
Accumulated Depreciation | 487 |
Net Book Value | 244 |
Capital Lease Obligations, Current | 246 |
Capital Lease Obligations, Noncurrent | 0 |
Capital Lease Obligations | $ 246 |
Segment Information (Narrative)
Segment Information (Narrative) (Details) | 12 Months Ended |
Jun. 30, 2016segment | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Number of technology business segments | 2 |
Segment Information (Financial
Segment Information (Financial Information by Segment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Sales | $ 3,540,226 | $ 3,218,626 | $ 2,913,634 |
Depreciation and amortization | 17,154 | 11,997 | 7,375 |
Operating income | 96,877 | 101,441 | 121,786 |
Capital expenditures | 12,081 | 20,762 | 11,228 |
Assets | 1,491,185 | 1,476,941 | |
Property and equipment, net | 52,388 | 46,574 | |
Operating Segments [Member] | Barcode and Security Products [Member] | |||
Sales | 2,381,331 | 2,134,124 | 2,003,911 |
Depreciation and amortization | 5,663 | 3,813 | 4,243 |
Operating income | 53,015 | 49,045 | 49,544 |
Capital expenditures | 5,310 | 733 | 784 |
Assets | 836,674 | 740,020 | |
Operating Segments [Member] | Communications and Services Products [Member] | |||
Sales | 1,158,895 | 1,084,502 | 909,723 |
Depreciation and amortization | 8,531 | 6,912 | 3,132 |
Operating income | 44,725 | 55,650 | 56,752 |
Capital expenditures | 3,911 | 1,448 | 316 |
Assets | 595,781 | 599,358 | |
Corporate, Non-Segment [Member] | |||
Depreciation and amortization | 2,960 | 1,272 | 0 |
Operating income | (863) | (3,254) | 15,490 |
Capital expenditures | 2,860 | 18,581 | 10,128 |
Assets | 58,730 | 137,563 | |
United States [Member] | |||
Sales | 2,655,760 | 2,391,073 | 2,225,962 |
United States [Member] | Operating Segments [Member] | |||
Property and equipment, net | 46,935 | 41,159 | |
International [Member] | |||
Sales | 920,098 | 871,862 | 733,744 |
International [Member] | Operating Segments [Member] | |||
Property and equipment, net | 5,453 | 5,415 | |
Less intercompany sales [Member] | |||
Sales | $ (35,632) | $ (44,309) | $ (46,072) |
Accumulated Other Comprehensi80
Accumulated Other Comprehensive Income (Loss) (Components Of Accumulated Other Comprehensive Income, Net Of Tax) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Currency translation adjustment | $ (72,687) | $ (64,502) | $ (16,700) |
Accumulated other comprehensive income (loss) | (72,687) | (64,502) | (16,700) |
Tax expense (benefit) allocated to other comprehensive income (loss) | $ 327 | $ 2,382 | $ (279) |
Subsequent Events (Details)
Subsequent Events (Details) ft² in Thousands, $ in Thousands | Aug. 29, 2016USD ($) | Jul. 06, 2016ft²extension | Jun. 03, 2014 |
Subsequent Event [Line Items] | |||
Term of lease | 3 years | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Area leased under lease agreement (in square feet) | ft² | 741 | ||
Term of lease | 135 months | ||
Number of lease extension options | extension | 2 | ||
Length of lease extension options | 5 years | ||
Stock repurchase, authorized amount | $ 120,000 | ||
Stock repurchase program term | 3 years | ||
Subsequent Event [Member] | Intelisys [Member] | |||
Subsequent Event [Line Items] | |||
Initial cash payment | $ 83,600 | ||
Purchase price amount held in escrow | $ 8,460 | ||
Earnout payments, number of installments | 4 | ||
Undiscounted contingent consideration payments, minimum | $ 100,000 | ||
Undiscounted contingent consideration payments, maximum | $ 150,000 | ||
Subsequent Event [Member] | Expansion Square Footage [Member] | |||
Subsequent Event [Line Items] | |||
Area leased under lease agreement (in square feet) | ft² | 148 |
Valuation And Qualifying Acco82
Valuation And Qualifying Accounts (Schedule Of Valuation and Qualifying Accounts) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2014 | ||
Valuation Allowances and Reserves, Recoveries | $ 1,500 | $ 3,900 | ||
Trade And Current Note Receivable Allowance [Member] | ||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Balance at Beginning of period | 32,589 | 26,257 | $ 25,479 | |
Amounts Charged to Expense | 7,571 | 993 | 6,573 | |
Reductions | [1] | (3,829) | (8,288) | (8,100) |
Other | [2] | 2,701 | 13,627 | 2,305 |
Balance at End of Period | 39,032 | 32,589 | $ 26,257 | |
KBZ [Member] | ||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Valuation Allowances and Reserves, Reserves of Businesses Acquired | $ 1,200 | |||
Imago [Member] | ||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Valuation Allowances and Reserves, Reserves of Businesses Acquired | 1,100 | |||
Network1 [Member] | ||||
Movement in Valuation Allowances and Reserves [Roll Forward] | ||||
Valuation Allowances and Reserves, Reserves of Businesses Acquired | $ 12,800 | |||
[1] | "Reductions" amounts represent write-offs for the years indicated. | |||
[2] | "Other" amounts include recoveries and the effect of foreign currency fluctuations for years ended June 30, 2016, 2015, and 2014. In addition, the amount in 2016 includes $1.5 million of recoveries and $1.2 million of accounts receivable acquired with KBZ on September 4, 2016. The amount in 2015 includes $3.9 million of recoveries, $1.1 million of accounts receivable reserves acquired with Imago Group plc on September 19, 2014, and $12.8 million of accounts receivable reserves acquired with Network 1 on January 13, 2015. |